Revisions to Auxiliary Installations, Replacement Facilities, and Siting and Maintenance Regulations, 72794-72813 [2013-28548]

Download as PDF 72794 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations (q) Related Information For more information about this AD, contact Rebel Nichols, Aerospace Engineer, Propulsion Branch, ANM–140S, FAA, Seattle Aircraft Certification Office, 1601 Lind Avenue SW., Renton, WA 98057–3356; phone: 425–917–6509; fax: 425–917–6590; email: rebel.nichols@faa.gov. (r) Material Incorporated by Reference (1) The Director of the Federal Register approved the incorporation by reference (IBR) of the service information listed in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51. (2) You must use this service information as applicable to do the actions required by this AD, unless the AD specifies otherwise. (3) The following service information was approved for IBR on January 8, 2014. (i) Boeing Alert Service Bulletin 727– 28A0133, dated October 5, 2011. (ii) Boeing Service Bulletin 727–28–0131, dated August 18, 2010. (iii) Boeing 727–100/200 Airworthiness Limitations (AWLs), D6–8766–AWL, Revision August 2010: (A) Airworthiness Limitation Instruction (ALI) Task 28–AWL–18, ‘‘Fuel Quantity Indicating System (FQIS)—Out-Tank Wiring Lightning Shield to Ground Termination,’’ of Section D., ‘‘Airworthiness Limitations—Fuel Systems.’’ (B) Critical Design Configuration Control Limitations (CDCCL) Task 28–AWL–19, ‘‘Fuel Quantity Indicating System (FQIS)— Out-Tank Wiring Lightning Shield to Ground Termination,’’ of Section D., ‘‘Airworthiness Limitations—Fuel Systems.’’ (C) ALI Task 28–AWL–20, ‘‘Fuel Boost Pump Wires in Conduit Installation—In Fuel Tank,’’ of Section D., ‘‘Airworthiness Limitations—Fuel Systems.’’ (D) CDCCL Task 28–AWL–21, ‘‘Fuel Boost Pump Wires in Conduit Installation—In Fuel Tank,’’ of Section D., ‘‘Airworthiness Limitations—Fuel Systems.’’ (4) The following service information was approved for IBR on June 6, 2007 (72 FR 28594, May 22, 2007). (i) Boeing Alert Service Bulletin 727– 28A0126, dated May 24, 1999. (ii) Boeing Alert Service Bulletin 727– 28A0132, dated February 22, 2007. (iii) Boeing Service Bulletin 727–28A0126, Revision 1, dated May 18, 2000. (5) For service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P. O. Box 3707, MC 2H–65, Seattle, WA 98124–2207; telephone 206– 544–5000, extension 1; fax 206–766–5680; Internet https://www.myboeingfleet.com. (6) You may view this service information at FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425–227–1221. (7) You may view this service information that is incorporated by reference at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202–741–6030, or go to: http:// www.archives.gov/federal-register/cfr/ibrlocations.html. Issued in Renton, Washington, on November 15, 2013. Jeffrey E. Duven, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. 2013–28994 Filed 12–3–13; 8:45 am] BILLING CODE 4910–13–P DEPARTMENT OF ENERGY Federal Energy Regulatory Commission 18 CFR Parts 2, 157, and 380 [Docket Nos. RM12–11–000 and RM12–11– 001; Order No. 790] Revisions to Auxiliary Installations, Replacement Facilities, and Siting and Maintenance Regulations Federal Energy Regulatory Commission, DOE. ACTION: Final rule. AGENCY: The Federal Energy Regulatory Commission (Commission) is issuing this Final Rule to amend its regulations to clarify that auxiliary installations added to existing or proposed interstate transmission facilities under the Commission’s SUMMARY: regulations must be located within the authorized right-of-way or facility site for the existing or proposed facilities and use only the same temporary work space that was or will be used to construct the existing or proposed facilities; and to codify the common industry practice of notifying landowners prior to coming onto their property to install auxiliary or replacement facilities, certain replacements, or conduct maintenance activities. DATES: This rule is effective February 3, 2014. FOR FURTHER INFORMATION CONTACT: Gordon Wagner, Office of the General Counsel, Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426 (202) 502– 8947, gordon.wagner@ferc.gov. Katherine Liberty, Office of the General Counsel, Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426 (202) 502– 6491, katherine.liberty@ferc.gov. Douglas Sipe, Office of Energy Projects, Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426 (202) 502– 8837, douglas.sipe@ferc.gov. Howard Wheeler, Office of Energy Projects, Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426 (202) 502– 8688, howard.wheeler@ferc.gov. SUPPLEMENTARY INFORMATION: 145 FERC ¶ 61,154 United States of America Federal Energy Regulatory Commission Revisions to Auxiliary Installations, Replacement Facilities, and Siting and Maintenance Regulations Docket Nos. RM12–11–000; RM12–11– 001 Order No. 790 Final Rule TABLE OF CONTENTS wreier-aviles on DSK5TPTVN1PROD with RULES Paragraph Nos. I. Background ................................................................................................................................................................................. A. Request for Clarification of Section 2.55(a) of the Commission’s Regulations ................................................................ B. Notice of Proposed Rulemaking (NOPR) .......................................................................................................................... II. Discussion ................................................................................................................................................................................. A. Section 2.55(a) Auxiliary Facilities ..................................................................................................................................... 1. Commission Jurisdiction ............................................................................................................................................. 2. Section 2.55 Siting and Construction Limitations ....................................................................................................... 3. Environmental Issues .................................................................................................................................................. 4. Compliance with Executive Orders ............................................................................................................................. 5. Section 2.55 Authorization and Part 157, Subpart F, Blanket Authorization ............................................................. 6. ‘‘Grandfathering’’ Existing Section 2.55(a) Installations ............................................................................................. 7. Burden of Section 2.55’s Right-of-Way Requirement ................................................................................................. B. Landowner Notification ...................................................................................................................................................... 1. Jurisdictional Basis and Need for Landowner Notification ......................................................................................... VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 E:\FR\FM\04DER1.SGM 04DER1 2 8 9 12 12 13 17 40 43 45 49 51 54 58 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations 72795 TABLE OF CONTENTS—Continued Paragraph Nos. 2. Exceptions to Landowner Notification Requirements ................................................................................................. 3. Part 157 Landowner Notification Exemption for Replacement Projects .................................................................... 4. Requirement that Notification Inform Landowners of the Availability of the Commission’s Dispute Resolution Division .............................................................................................................................................................................. 5. Landowner Notification for Maintenance Activities ..................................................................................................... 6. Burden Resulting from Notification Requirement ....................................................................................................... III. Information Collection Statement ............................................................................................................................................. IV. Environmental Analysis ............................................................................................................................................................ V. Regulatory Flexibility Act ........................................................................................................................................................... VI. Document Availability ............................................................................................................................................................... VII. Effective Date and Congressional Notification ....................................................................................................................... 145 FERC ¶ 61,154 United States of America Federal Energy Regulatory Commission Before Commissioners: Jon Wellinghoff, Chairman; Philip D. Moeller, John R. Norris, Cheryl A. LaFleur, and Tony Clark. Revisions to Auxiliary Installations, Replacement Facilities, and Siting and Maintenance Regulations Docket Nos. RM11–12–000; RM11–12– 001 Order No. 790 Final Rule wreier-aviles on DSK5TPTVN1PROD with RULES (Issued November 22, 2013) 1. The Federal Energy Regulatory Commission (Commission) is issuing this Final Rule to amend its regulations to (1) clarify that auxiliary installations added to existing or proposed interstate transmission facilities under section 2.55 of the regulations 1 must be located within the authorized right-of-way or facility site for the existing or proposed facilities and use only the same temporary work space that was or will be used to construct the existing or proposed facilities; and (2) codify the common industry practice of notifying landowners prior to coming onto their property to install auxiliary or replacement facilities under section 2.55; certain replacements under Part 157, Subpart F; or conduct maintenance activities under section 380.15. I. Background 2. Section 7(c)(1)(A) of the Natural Gas Act (NGA) requires a natural gas company to have certificate authorization for the ‘‘construction or extension of any facilities.’’ 2 To ‘‘avoid the filing and consideration of unnecessary applications for certificates,’’ 3 i.e., to save the time and 1 18 CFR 2.55 (2013). U.S.C. 717f(c)(1)(A) (2012). 3 Filing of Applications for Certificates of Public Convenience and Necessity, Notice of Proposed 2 15 VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 expense that would otherwise be expended by companies and the Commission in undertaking a full, formal NGA section 7 certificate proceeding for every modification to an authorized system, the Commission added section 2.55 to its regulations.4 Rulemaking, NOPR, 13 FR 6253, at 6254 (October 23, 1948). 4 Section 2.55 went into effect in 1949. The Commission subsequently considered expanding section 2.55, but stated that although it ‘‘recognizes the desirability of dealing with minor installations on a practical basis,’’ it would not rely on section 2.55 because of ‘‘doubts that the Natural Gas Act authorizes it to further expand its rule excluding certain facilities from the certification requirements’’; instead the Commission ‘‘recommended to the Congress that it be given such authority’’ to ‘‘permit[] greater flexibility in its procedures with respect to rate filings and certification of natural-gas facilities.’’ Amending the Commission’s General Rules and Regulations, Order No. 185, 15 FPC 793, at p. 794 (1956). Such authority was not forthcoming. In an effort to forego issuing an individual certificate authorization in advance of every single jurisdictional action, the Commission provided for companies to file a single certificate application under section 157.6 that ‘‘covered in general outline along the lines of a budget estimate the proposed routine construction intended to be undertaken by it during the current or ensuing fiscal year,’’ describing the facilities, costs, capacity, purpose, construction schedule, customers affected, effects on gas supply, rates, service, etc. Id. The Commission added section 2.58 to its regulations for these ‘‘budget-type’’ certificate applications, see Gas Purchase Facilities—BudgetType Certificate Applications, Order No. 247, 27 FPC 1119 (1962). These regulations were removed in 1982 when the blanket certificate program was instituted, which offered companies a streamlined means to obtain certificate authorization for a limited set of routine and well understood facilities. Interstate Pipeline Certificates for Routine Transactions, Order No. 234, 47 FR 24254 (June 4, 1982), FERC Stats. & Regs., Regulations Preambles 1982–1985 ¶ 30,368 (1982), order on reh’g, Order No. 234–A, 47 FR 38871 (September 3, 1982), FERC Stats. & Regs., Regulations Preambles 1982–1985 ¶ 30,389 (1982), amended by, Sales and Transportation by Interstate Pipelines and Distributors; Expansion of Categories of Activities Authorized Under Blanket Certificate, Order No. 319, 48 FR 34875 (August 1, 1983), FERC Stats. & Regs., Regulations Preambles 1982–1985 ¶ 30,479 (1983). The scope of the blanket-eligible facilities has been expanded several times since 1982. See, e.g., Revisions to the Blanket Certificate Regulations and Clarification Regarding Rates, Order No. 686, 71 FR 63680 (October 31, 2006), FERC Stats. & Regs. ¶ 31,231 (2006), order on reh’g and clarification, PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 62 64 65 68 73 80 88 89 92 95 Section 2.55 establishes that for the purposes of section 7(c), ‘‘the word facilities as used therein shall be interpreted to exclude’’ auxiliary and replacement facilities.5 Thus, while an auxiliary or replacement facility that qualifies for purposes of section 2.55 remains subject to the Commission’s NGA jurisdiction, it does not require an individual, facility-specific section 7(c) certificate authorization. 3. Facilities that qualify under section 2.55(a) must be ‘‘merely auxiliary or appurtenant to an authorized or proposed pipeline transmission system’’ and installed ‘‘only for the purpose of obtaining more efficient or more economical operation of the authorized or proposed transmission facilities,’’ such as ‘‘[v]alves; drips; pig launchers/ receivers; yard and station piping; cathodic protection equipment; gas cleaning, cooling and dehydration equipment; residual refining equipment; water pumping, treatment and cooling equipment; electrical and communication equipment; and buildings.’’ 6 Order No. 686–A, 72 FR 37431 (July 10, 2007), FERC Stats. & Regs. ¶ 31,249 (2007), order on reh’g, Order No. 686–B, 72 FR 54818 (September 27, 2007), FERC Stats. & Regs. ¶ 31,255 (2007). 5 18 CFR 2.55 (2013). 6 Id. 2.55(a)(1). But for the inclusion of pig launchers/receivers in 1999, this list has remained unaltered since section 2.55 was put in place in 1949. Note that if a pipeline company wants to install any facilities specifically named in section 2.55(a)(1), but will not be installing them only for the purpose of obtaining more efficient or more economical operation of existing or proposed interstate transmission facilities, then the company cannot rely on section 2.55(a). See, e.g., Algonquin Gas Transmission Company (Algonquin), 57 FERC ¶ 61,052 (1991), in which the Commission found a company’s reliance on section 2.55(a) to install an air stabilization unit was unwarranted because the unit was necessary for the company to meet the terms of its service agreements and comply with safety requirements, and thus was not only for the purpose of obtaining more efficient or more economical operation of its transmission facilities. See also West Texas Gas, Inc., 62 FERC ¶ 61,039 (1993), in which the Commission found section 2.55(a) did not apply to facilities constructed to interconnect with another pipeline because the E:\FR\FM\04DER1.SGM Continued 04DER1 72796 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations wreier-aviles on DSK5TPTVN1PROD with RULES 4. Originally, natural gas companies were not required to notify the Commission in advance of construction under section 2.55(a). However, in 1999 the Commission determined that when companies plan to add auxiliary facilities to a project that has already been authorized, but not yet completed, or to a project for which authorization is still pending, prior notification to the Commission is needed in order to afford the Commission the opportunity to assess the auxiliary facilities’ environmental impacts, impacts which, when combined with the impacts of the construction and operation of the facilities that will be augmented by the auxiliary facilities, could potentially alter the Commission’s conclusions regarding the overall environmental impact of the project. 5. As a result, Order No. 603 7 revised section 2.55(a)(2) to require that if a company plans to rely on section 2.55 to construct auxiliary facilities in conjunction with: (1) A project for which case-specific certificate authority has already been received but which is not yet in service, (2) a proposed project for which a case-specific certificate application is pending, or (3) facilities that will be constructed subject to the prior notice provisions of the Part 157, Subpart F blanket certificate regulations, then the company must provide a description of the auxiliary facilities and their location to the Commission at least 30 days in advance of their installation.8 In the case of auxiliary facilities that will be constructed in conjunction with a project for which an purpose of the interconnect was to enable the company to gain access to cheaper sources of gas, and thus was not only for the purpose of obtaining more efficient or more economical operation of its transmission facilities and Natural Gas Pipeline Company of America, 114 FERC ¶ 61,061, at n.4 (2006), in which the Commission rejected a company’s effort to employ section 2.55(a) to undertake well recompletions in a storage reservoir, ‘‘because the construction is designed to provide incremental storage capacity rather than to maintain the current level of service for existing customers,’’ and consequently required the company to obtain case-specific authorization for the recompletions (the company was permitted to rely on section 2.55(a) to make other modifications to its storage facility, including adding station piping, header and isolation valves with blowdowns, control valves, gas coolers, a transformer, field inlet separation facilities, and pigging equipment). 7 Revisions of Existing Regulations Under Part 157 and Related Sections of the Commission’s Regulations Under Natural Gas Act, Order No. 603, 64 FR 26572, at 26574 (May 14, 1999), FERC Stats. & Regs., Regulations Preambles July 1996–December 2000 ¶ 31,073 (1999), order on reh’g, Order No. 603–A, 64 FR 54522 (October 7, 1999), FERC Stats. & Regs., Regulations Preambles July 1996–December 2000 ¶ 31,081 (1999), order on reh’g, Order No. 603–B, 65 FR 11,462 (March 3, 2000), FERC Stats. & Regs., Regulations Preambles July 1996–December 2000 ¶ 31,094 (2000). 8 See 18 CFR 2.55(a)(2)(ii) (2013). VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 application under Part 157, Subpart A for case-specific certificate authority is pending, the auxiliary facilities must be described in the application’s environmental report, as required by section 380.12 of the Commission’s regulations, or in a supplemental filing while the application is pending.9 The Commission explained these advance notification requirements are necessary in order to afford the Commission time to include the environmental impacts of the auxiliary facilities as part of its environmental review of the project.10 6. Section 2.55(b) permits companies to replace facilities that are or will soon be physically deteriorated or obsolete, so long as doing so will not result in a reduction or abandonment of service and the replacement facilities will have a substantially equivalent designed delivery capacity.11 Section 2.55(b) replacement projects can go forward without case-specific or blanket certificate authorization. Further, the 30-day prior notice requirement in section 2.55(b)(2) for more expensive replacement projects only requires notice to the Commission, not landowners.12 9 See 18 CFR 2.55(a)(2)(iii) (2013). In the case of auxiliary facilities to be constructed in conjunction with a proposed project for which an application for case-specific certificate authority is pending, section 2.55(a)(2)(iii) requires that the applicant describe the auxiliary facilities in the application’s section 380.12 Resource Report 1—General Project Description. Section 380.12(c)(1) requires the applicant to describe and provide location maps for ‘‘all jurisdictional facilities, including all aboveground facilities associated with the project (such as: meter stations, pig launchers/receivers, valves), to be constructed, modified, abandoned, replaced, or removed, including related construction and operational support activities and areas such as maintenance bases, staging areas, communications towers, power line, and new access roads (roads to be built or modified).’’ Section 380.12(c)(2) requires that the applicant’s Resource Report 1 identify and describe ‘‘all nonjurisdictional facilities, including auxiliary facilities, that will be built in association with the project, including facilities to be built by other companies.’’ If a company with a pending application for case-specific certificate authority determines that it will also need to construct auxiliary facilities, section 2.55(a)(2)(iii) requires that the applicant make a supplemental filing describing the auxiliary facilities while the application is pending. 10 Revisions to Regulations Governing NGPA Section 311 Construction and the Replacement of Facilities, Order No. 544, 57 FR 46,487 (October 9, 1992), FERC Stats. & Regs., Regulations Preambles January 1991–June 1996 ¶ 30,951 (1992), order on reh’g, Order No. 544–A, 58 FR 57730 (October 27, 1993), FERC Stats. & Regs., Regulations Preambles January 1991–June 1996 ¶ 30,983 (1993). 11 18 CFR 2.55(b) (2013). 12 The requirement that a company give at least 30 days prior notice to the Commission before commencing a replacement project applies if the project will exceed the current cost limit for projects automatically authorized under the Part 157 blanket certificate regulations. However, unlike the blanket certificate regulations, section 2.55 PO 00000 Frm 00006 Fmt 4700 Sfmt 4700 7. In Order No. 603 the Commission specified that all replacement facilities must be constructed within the previously authorized right-of-way or facility site for the existing facilities and use the same temporary work spaces used for construction of the existing facilities.13 The Commission reasoned that section 2.55(b) replacements ‘‘should only involve basic maintenance or repair to relatively minor facilities,’’ where it has been determined that no significant impact to the environment would occur.14 The Commission suggested that in situations where a company wants to use land outside previously authorized areas, it may be able to rely on its blanket certificate authority rather than 2.55(b) to undertake the project.15 A. Request for Clarification of Section 2.55(a) of the Commission’s Regulations 8. On April 2, 2012, the Interstate Natural Gas Association of America (INGAA) requested clarification regarding the installation of auxiliary facilities under section 2.55(a) of the Commission’s regulations.16 INGAA maintained that Commission staff had stated in discussions with pipeline representatives and in industry meetings that companies undertaking section 2.55(a) auxiliary installations to augment existing facilities that are already in service must stay within the right-of-way or facility site for the existing facilities and restrict construction activities to previously used work spaces. INGAA disagreed with these constraints, arguing that section 2.55(a) activities had not been limited in this way in the past, and that Commission staff’s position amounted to rulemaking without the opportunity for notice and comment, contrary to the requirements of the Administrative Procedure Act (APA).17 Pursuant to section 385.207(a)(4) of the Commission’s Rules of Practice and Procedure, INGAA requested that the Commission confirm INGAA’s view that the right-of-way and work space constraints stated by staff do not apply to section 2.55(a) auxiliary installations. places no cost limits on auxiliary installations or replacement projects that qualify under that section. 13 Order No. 603, 64 FR 26572 at 26574–76, FERC Stats. & Regs. ¶ 31,073 and 18 CFR 2.55(b) (2013). 14 Order No. 603–A, 64 FR 54522 at 54524, FERC Stats. & Regs. ¶ 31,081. 15 Order No. 603, 64 FR 26572 at 26580, FERC Stats. & Regs. ¶ 31,073. 16 On May 2, 2012, MidAmerican Energy Pipeline Group (which includes Kern River Gas Transmission Company and Northern Natural Gas Company) filed a motion to intervene and comments in support of INGAA’s petition. 17 5 U.S.C. 553 (2012). E:\FR\FM\04DER1.SGM 04DER1 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations B. Notice of Proposed Rulemaking (NOPR) 9. On December 20, 2012, the Commission issued a NOPR proposing to revise its regulations to clarify that, as with replacement projects under section 2.55(b), all auxiliary installation projects must take place within a company’s authorized right-of-way or facility site and use only previously approved work spaces. In addition, the NOPR proposed to add a 10-day landowner notification requirement for section 2.55 auxiliary and replacement facilities and for section 380.15 maintenance activities.18 Timely comments on the NOPR were submitted by INGAA; 19 Golden Triangle Storage, Inc. (Golden Triangle); MidAmerican Energy Pipeline Group (MidAmerican Energy); Southern Star Central Gas Pipeline, Inc. (Southern Star); National Fuel Supply Corporation and Empire Pipeline, Inc. (National Fuel); and WBI Energy Transmission, Inc. (WBI Energy). Golden Triangle, MidAmerican Energy, Southern Star, and WBI Energy support INGAA’s comments. 10. The commentors object to the Commission’s position that auxiliary installations to enhance existing facilities must be located within the previously authorized areas for the existing facilities, arguing the Commission has not heretofore imposed such a limitation on the siting or construction of auxiliary facilities. 11. The commentors also oppose the NOPR’s proposed new requirement that companies give prior notice to affected wreier-aviles on DSK5TPTVN1PROD with RULES 18 Revisions to Auxiliary Installations, Replacement Facilities, and Siting and Maintenance Regulations, NOPR, 78 FR 679, 683 (January 4, 2013), FERC Stats. & Regs. ¶ 32,696 (2012) (cross-referenced at 141 FERC ¶ 61,228 (2012)). While section 380.15 covers siting, construction, and maintenance, our existing regulations already have notification requirements in place applicable to siting and construction; consequently, the additional prior notice requirement described in the new section 380.15(c) will apply exclusively to maintenance activities. 19 On January 22, 2013, INGAA made a filing styled as a request for rehearing of the NOPR, and on March 5, 2013, it filed comments on the NOPR. INGAA argues the NOPR functioned as a Final Rule by giving immediate effect to a change in the regulations without providing affected entities notice and an opportunity to comment. We do not believe the NOPR’s clarification concerning section 2.55(a) effected any change; rather, it articulated existing, long-standing constraints and obligations with respect to auxiliary installations. Because the NOPR does not constitute an instant Final Rule, we find no cause to consider requests for rehearing of the NOPR. Nevertheless, we will accept INGAA’s request for rehearing and treat it as comments in response to the NOPR. Thus, regardless of the distinction between INGAA’s and the Commission’s characterization of the NOPR, the concerns INGAA raises in both of its submissions will be addressed herein. We will identify INGAA’s self-styled request for rehearing as January 2013 Comments and its subsequent submission as March 2013 Comments. VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 landowners before commencing construction of auxiliary or replacement facilities under section 2.55 of the regulations or maintenance activities under section 380.15 of the regulations. Although the commentors do not dispute the Commission’s position in the NOPR that it is appropriate to give landowners prior notice to the extent practicable in order to minimize inconvenience to landowners, the commentors contend the proposed notice procedures described in the NOPR (1) are unnecessary, noting that some companies already comply with the spirit of this stipulation, and (2) are impractical, particularly with respect to urgent or unanticipated maintenance activities. II. Discussion A. Section 2.55(a) Auxiliary Facilities 12. In this Final Rule, the Commission revises its regulations, as proposed in the NOPR, to clarify that all section 2.55(a) auxiliary installations added to existing or proposed interstate transmission facilities must be located within the authorized right-of-way or facility site for the existing or proposed facilities and use only the same temporary work space that was or will be used to construct the existing or proposed facilities. 1. Commission Jurisdiction 13. INGAA argues that section 2.55(a) can be distinguished from section 2.55(b) on the grounds that auxiliary facilities are not needed to provide certificated services, and therefore are not jurisdictional, while replacement facilities are essential to provide certificated services, and therefore are jurisdictional. We disagree. Although section 2.55 states that ‘‘for purposes of section 7(c) of the Natural Gas Act, as amended, the word facilities as used therein shall be interpreted to exclude’’ auxiliary and replacement facilities,20 the Commission’s choice of wording in drafting this section cannot change the fact that section 2.55(a) auxiliary facilities and section 2.55(b) replacement facilities nevertheless are jurisdictional facilities for purposes of section 7 of the NGA. It went without saying in 1949, and has largely gone without saying since, that all section 2.55 facilities are subject to the Commission’s jurisdiction. This is obvious with respect to replacements, since the new facilities step into the shoes of the aging facilities they 20 Hence the title of section 2.55, Definition of terms used in section 7(c), and the placement of section 2.55 in Part 2, General Policy and Interpretations. PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 72797 replicate, and so assume the replaced facilities’ jurisdictional status. Section 2.55(a) auxiliary installations are also jurisdictional, comprising that category of facilities that enable companies to operate existing or proposed jurisdictional facilities more efficiently or economically. All section 2.55 facilities are integrated into a larger interstate transmission system and serve no function other than to enable that system to perform its jurisdictional functions more efficiently or economically; just as the larger system is jurisdictional, the component parts of that system, including auxiliary facilities installed pursuant to section 2.55, are jurisdictional as well.21 14. INGAA states that the NGA mandates that any jurisdictional facility must be certificated. We concur. As we have stated: ‘‘Section 2.55 of the Commission’s regulations serves, in effect, as standing authorization for pipelines to perform periodic maintenance and routine replacement’’ in order to ‘‘permit pipelines to undertake limited construction projects without waiting for NGA section 7(c) case specific certificate authorization.’’ 22 In other words, section 2.55 grants automatic certificate authorization for a limited class of facilities. 15. To qualify under section 2.55(a), facilities must serve ‘‘only for the purpose of obtaining more efficient operation or more economical operation of the authorized or proposed 21 If facilities are installed in reliance on section 2.55, but do not meet the criteria of this section, then they are jurisdictional facilities installed without the requisite Commission certificate authorization. For example, in Algonquin, after finding facilities installed under color of section 2.55(a) did not qualify under that section, we directed the company to show cause ‘‘why it did not violate and is not violating section 7(c) of the Natural Gas Act by constructing and operating [facilities] without obtaining a certificate from the Commission.’’ 57 FERC ¶ 61,052, at 61,205–06. The company subsequently obtained case-specific certificate authorization for the facilities at issue in Boston Gas Company, 70 FERC ¶ 61,122, Ordering Paragraph (F) (1995). 22 Emergency Reconstruction of Interstate Natural Gas Facilities Under the Natural Gas Act, Notice of Proposed Rulemaking, 68 FR 4120 (January 28, 2003), FERC Stats. & Regs. ¶ 32,567, at 34,679–80 (2003). In the interest of administrative and industrial efficiency, we have dismissed requests for case-specific section 7 certificate authorization for facilities that qualified for this ‘‘standing authorization’’ provided by section 2.55. For example, in Columbia Gas Transmission Corporation, 68 FERC ¶ 61,156, at 61,743 (1994), we dismissed a request for case-specific section 7 certificate authorization to install a pigging and a methanol injection system after finding that the proposed facilities would serve only for the purpose of obtaining more efficient or more economical operation of an authorized transmission system, and thus qualified as auxiliary facilities that could and should be installed under section 2.55(a). E:\FR\FM\04DER1.SGM 04DER1 72798 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations transmission facilities’’ (emphasis added).23 Therefore, we have always assumed that section 2.55(a) would necessarily be confined to projects small enough and inconsequential enough that their environmental and economic impacts would not merit the close scrutiny provided by (and time and expense consumed by) case-specific NGA section 7 review.24 Auxiliary facilities installed in reliance on section 2.55(a) will be added either to existing interstate transmission facilities that were subject to environmental review prior to construction or to a proposed project, in which case the applicant must identify in its certificate application the auxiliary facilities it plans to install in conjunction with the project, so that the auxiliary facilities will be included in the review of the project’s environmental impacts.25 In the case of section 2.55(b) replacement facilities, an environmental review was performed prior to construction of the existing facilities to be replaced,26 and the replacement facilities must be in the same right-of-way and be substantially equivalent in design capacity to the existing facilities.27 23 Supra n.6. sentiment in Order No. 603–A, 64 FR 54522 at 54524, FERC Stats. & Regs. ¶ 31,081, that replacements ‘‘should only involve basic maintenance or repair to relatively minor facilities where the Commission has determined that no significant impact to the environment will occur’’ is applicable as well to auxiliary installations. 25 As discussed above, if a company plans to rely on section 2.55(a) to install auxiliary facilities in conjunction with a project under its Part 157 blanket construction certificate that it is subject to prior notice, the company must give the Commission notice of the type and planned location of auxiliary facilities at least 30 days prior to installation. See 18 CFR 2.55(a)(2)(ii) (2013). 26 In the case of existing facilities constructed pursuant to blanket certificate authority, the facilities’ construction was subject to the blanket program’s section 157.206(b) environmental compliance provisions. 27 For example, if a natural gas company wants to replace a deteriorated section of 12-inch-diameter pipe with 24-inch-diameter pipe, it generally cannot rely on section 2.55(b) to undertake such work, as the use of larger pipe could require larger equipment and greater ground disturbance and thus raise environmental issues that were not considered when the12-inch-diameter pipeline was authorized. In addition, while the replacement of deteriorated facilities is necessary to maintain existing service levels, section 2.55 does not provide the opportunity for a company’s customers to raise issues regarding the replacement project’s cost. Thus, limiting replacement activities under section 2.55(b) to the construction of facilities that will be substantially equivalent in design capacity to the existing facilities is appropriate. If a company believes that there is a need for the replacement facilities to have significantly greater capacity, it can undertake the replacement project under its Part 157, Subpart F blanket construction certificate program, subject to the regulations’ cost limits and environmental conditions. If the replacement project will exceed the blanket certificate cost limits or the company cannot satisfy the blanket certificate wreier-aviles on DSK5TPTVN1PROD with RULES 24 The VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 16. Since the wording of section 2.55 of the regulations cannot work to exclude auxiliary and replacement facilities from the scope of our jurisdiction under NGA section 7, section 2.55 effectively provides not an NGA-exemption, but a type of ‘‘blanket’’ certificate authority, so that a company does not need to seek additional, specific certificate authority to add minor auxiliary facilities to its previously certificated facilities or to replace its previously certificated facilities. Section 2.55 provides pregranted or automatic certificate authorization to a specific, limited set of facilities, and does so to avoid triggering an unnecessary level of review for certain minor modifications to an existing or pending interstate transmission system. Section 2.55 is both a precursor and complement to our Part 157 blanket certificate program. By providing non-case specific certificate authorization for limited classes of facilities, the section 2.55 and blanket certificate regulations permit companies to satisfy the requirements of section 7(c) without having to apply for individual case-specific certificates for each and every modification to their systems. 2. Section 2.55 Siting and Construction Limitations 17. In 1994, we first had cause to clarify the parameters of section 2.55, in response to a request to increase operating pressures and make other changes to a pipeline system in Arkla Energy Resources Company (Arkla).28 In reviewing the existing facilities, it came to light that Arkla had undertaken several years before, in reliance on section 2.55(b), to replace 91 miles of old 18-inch-diameter pipe on a segment of its system by abandoning it in place and installing new 20-inch-diameter pipe along a parallel path, which had required widening the existing right-ofregulations’ environmental conditions, the company can file an application for case-specific certificate authority and initiate a proceeding in which its customers and other parties can raise any concerns. Note that as discussed in the NOPR, to account for subsequent modifications having been made to original facilities—in particular blanket certificate projects that in adding to or altering original facilities establish new permanent right-ofway and new temporary work space—we will revise the section 2.55(b)(1)(ii) requirement that replacements must be confined to areas authorized for the ‘‘original facility’’ to allow for replacements within areas authorized for the ‘‘existing facility.’’ 28 67 FERC ¶ 61,173 (1994), order on reh’g, NorAm Gas Transmission Company, 70 FERC ¶ 61,030 (1995) (Arkla/NorAm). Arkla was in the process of changing its name to NorAm at the time the Commission issued its order finding that Arkla’s replacement project did not qualify to go forward under section 2.55(b). Thus, Arkla sought rehearing under its new name. PO 00000 Frm 00008 Fmt 4700 Sfmt 4700 way along portions of the route by an additional 25 feet. We acknowledged that (1) section 2.55(b) did not ‘‘specify whether replacement facilities must be constructed in the existing right-ofway,’’ and that (2) there was no case law that ‘‘directly addressed this issue.’’ 29 However, we explained that construction outside the right-of-way that was studied and authorized for the existing facilities potentially could have environmental impacts that had not been included in our environmental review of the facilities being replaced.30 Thus, we clarified that: [S]ection 2.55(b) means that replacement facilities must be constructed within the existing right-of-way. The reason is simple. The authority to replace a facility and to establish a right-of-way should be limited by the terms and locations delineated in the original construction certificate. Thus, a certificate holder that later establishes a new right-of-way for purposes of replacement engages in an unauthorized activity which is outside the parameters of the original certificate order.31 18. We subsequently codified this Arkla/NorAm clarification in Order No. 603 by amending section 2.55(b) to add the phrase ‘‘will be located in the same right-of-way or on the same site as the facilities being replaced, and will be constructed using the temporary work space used to construct the original 29 67 FERC ¶ 61,173 at 61,516. 30 Id. 31 Id. As we noted in Arkla/NorAm, at the time replacement activities limited to the existing rightof-way were categorically excluded by section 380.4(24) based on the assumption that impacts on the environment will be insignificant if construction activities to replace facilities are limited to work within a pipeline’s existing compressor station yard or right-of-way. Following Arkla/NorAm, we concluded that even if construction activities will be confined to the existing right-of-way, there may be the need for further environmental review if a replacement project involves the construction of extensive facilities, or there have been changes in land use over time in the vicinity of the existing facilities (for example, the existing facilities may have been constructed in an area that was rural in nature at the time but is now densely populated), or the pipeline company’s replacement project may be associated with the construction of other, nonjurisdictional facilities that could also have environmental impacts. We rectified the situation in Order No. 544, explaining that because we have ‘‘a responsibility under NEPA to review replacement activities that pose potentially serious, adverse environmental impact . . . we need to be informed of such activities before they occur.’’ Order No. 544, 57 FR 46487, at 46491 (October 9, 1992); FERC Stats. & Regs. ¶ 30,951, at 30,686–87 (1992). Thus, while most replacement projects involve minor facilities and no potential for significant environmental impacts, we amended section 2.55(b) to require that companies notify us at least 30 days prior to commencing replacement projects so that there is time for staff to assess whether the project needs to be delayed in order to conduct further environmental review. E:\FR\FM\04DER1.SGM 04DER1 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations wreier-aviles on DSK5TPTVN1PROD with RULES facility.’’ 32 In this rulemaking proceeding, we are clarifying that this same right-of-way/work space limitation is equally applicable to auxiliary installations under section 2.55(a). Rather than provide clarification in a case-specific proceeding, as the Commission did in Arkla/NorAm, and then revise the regulation in a subsequent rulemaking proceeding, here we conflate clarification-to-codification for section 2.55(a) into this single proceeding. 19. As in Arkla/NorAm, construction outside the right-of-way could have environmental impacts that were not included in our environmental review of the existing facilities. In such circumstances, we could not fulfill our NEPA responsibilities if we were to allow companies to continue acquiring additional rights-of-way and work spaces to install auxiliary facilities under color of section 2.55(a) in areas not included in the environmental reviews for existing and proposed transmission facilities. We must ensure that environmental reviews are 32 Order No. 603, 64 FR 26572 (May 14, 1999), FERC Stats. & Regs. ¶ 31,073 (1999). INGAA asserts the NOPR in this proceeding erroneously stated that the Commission did not address section 2.55(a) auxiliary facilities in Order No. 603 when it revised section 2.55(b) to limit replacement projects to the originally authorized rights-of-way and work spaces for the existing facilities. While, as noted above, Order No. 603 did indeed address section 2.55(a) auxiliary facilities, specifically adding the notification requirements of section 2.55(a)(2), Order No. 603 did not address the right-of-way requirements relating to the installation of auxiliary facilities because the Commission assumed that there would be no need for gas companies to go outside previously authorized or proposed rights-ofway and work spaces in order to install minor facilities that, as specified in section 2.55(a), are ‘‘merely auxiliary or appurtenant’’ to and ‘‘only for the purpose of obtaining more efficient or more economical operation of the authorized or proposed transmission facilities.’’ We explained in the NOPR in this proceeding that Order No. 603, as it pertained to spatial limitations on the construction of facilities, dealt specifically with replacement facilities, and therefore only discussed the rationale for requiring section 2.55(b) replacement facilities to be located within an existing right-of-way. We also explained that no party raised any issue in the Order No. 603 rulemaking proceeding regarding spatial limitations on the installation of auxiliary facilities under section 2.55(a), and therefore we saw no need in Order No. 603 to discuss whether the construction and location of auxiliary installations to enhance existing facilities must fall within the same footprint as the existing facilities. NOPR, FERC Stats. & Regs. ¶ 32,696 at P 15. The NOPR also pointed out that nothing in Order No. 603 evinced an intent to permit auxiliary facilities or auxiliary installation activities outside of authorized rights-of-way and work spaces. Id. Thus, although we accept that the NOPR could have provided a more precise summary of Order No. 603, we reject INGAA’s claim that the NOPR misrepresented Order No. 603, particularly since the NOPR describes concerns discussed in Order No. 603 with respect to auxiliary facilities, and recites the resulting revisions made to section 2.55(a). Id. P 4. VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 performed and appropriate mitigation measures identified, and this NEPA obligation extends to additional areas landowners may cede to gas companies for jurisdictional activities or facilities. While the environmental review conducted by the Commission in a certificate proceeding encompasses a corridor wider than the right-of-way and temporary work spaces eventually authorized, land usage and other circumstances can change over time, particularly in areas in which no jurisdictional facilities are located, and the Commission’s findings based on its environmental review in a past certificate proceeding may no longer be valid for the entire corridor originally studied. This makes it reasonable and necessary to confine all auxiliary facilities and construction activities under section 2.55 to Commissionauthorized rights-of-way and work spaces. 20. INGAA states that ‘‘[t]he Commission has not been confronted with issues resulting from auxiliary installations outside an existing right-ofway similar to the issues that arose in Arkla/NorAm from replacement facilities.’’ 33 We acknowledge that we are not aware of any section 2.55(a) auxiliary activities outside the authorized right-of-way approaching the scale of the section 2.55(b) replacement activities outside the right-of-way that came to light during the Arkla/NorAm proceeding.34 Nevertheless, the issues raised for sections 2.55(a) and (b) activities are the same.35 We covered these issues in the NOPR, identifying our principle concern as the absence of any review of the environmental impacts of activities outside of authorized areas. 21. INGAA emphasizes that ‘‘cathodic protection equipment,’’ ‘‘electrical and communication equipment,’’ ‘‘pig launcher/receivers,’’ and ‘‘buildings’’ are listed specifically in section 2.55 as examples of auxiliary installations, and contends these types of facilities typically extend beyond a pipeline’s right-of-way and/or require additional work space to install.36 We do not find 33 INGAA’s January 2013 Comments at p. 15. had made numerous egressions from the existing right-of-way and acquired significant additional land rights without the Commission’s knowledge in order to widen the existing right-ofway by 25 feet along significant portions of the 91 miles of pipeline that was replaced. Arkla had needed the wider right-of-way in order to use larger-diameter replacement pipe that it laid alongside the old pipe that was abandoned in place. 35 See Arkla 67 FERC ¶ 61,173 at 61,517–18. 36 See INGAA’s January 2013 Comments at p. 31. In several instances, commentors describe contemporary cathodic protection components as often being located outside an established right-of34 Arkla PO 00000 Frm 00009 Fmt 4700 Sfmt 4700 72799 these examples sufficient to preclude our action here. While we understand that the installation of any particular one of the types of facilities named in section 2.55(a)(1) may require additional right-of-way or work space, if this is the case, then that particular facility could not be installed pursuant to section 2.55(a). There are any number of cathodic protection equipment, electrical and communication equipment, pig launcher/receivers, and buildings that have been and can be added without straying beyond the confines of previously authorized areas, and such facilities can be installed pursuant to section 2.55(a). As discussed below, section 2.55(a) will continue to reduce the burden that would be imposed if every natural gas facility required case-specific certificate authorization. Our decision to revise our regulations to explicitly confine section 2.55(a) auxiliary facilities to Commission-authorized rights-of-way and work spaces is necessary to clarify industry misinterpretations and to meet our obligations under NEPA, as discussed above, which cannot be fulfilled if we allow companies to construct auxiliary facilities in areas outside of existing rights-of-way. Further, while less convenient, most auxiliary installation projects that do not qualify under section 2.55(a) because additional right-of-way or work space is needed can be undertaken by companies by relying on their Part 157 blanket construction certificates, subject to those regulations’ environmental and cost conditions. If a company cannot satisfy the blanket certificate regulations’ environmental and cost conditions, it can file an application to initiate a proceeding for case-specific certificate authority, during which the Commission will conduct an way. However, in 1949 when ‘‘cathodic protection equipment’’ was included in section 2.55(a), cathodic protection commonly was provided by passive systems that rely on the electrical potential between the pipeline and anode. Such systems require close spacing between the pipeline and anode, and therefore would likely be placed within the right-of-way. Thus, the inclusion of cathodic protection equipment in the list of auxiliary facilities that may qualify for purposes of section 2.55(a) reflected the fact that, at least in some instances, additional right-of-way or work space is not needed to install such equipment. The 1949 inclusion of ‘‘cathodic protection equipment’’ in section 2.55(a) did not anticipate the impressed current systems commonly used today, which require that anodes be placed some distance (e.g., 100 meters) from the pipeline, far beyond the typical width of right-of-way needed or authorized for laying pipe in the ground. Nonetheless, we note that impressed current systems which use deep well anode beds, can be set entirely within the typical width of a right-of-way and can qualify under section 2.55(a). E:\FR\FM\04DER1.SGM 04DER1 72800 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations wreier-aviles on DSK5TPTVN1PROD with RULES environmental review and identify any appropriate mitigation measures.37 22. Commenters raised specific examples. INGAA, Southern Star, and National Fuel observe that the list of auxiliary installations includes ‘‘buildings,’’ and contend that generally it is not feasible to construct buildings within the previously authorized rightof-way containing existing pipeline facilities. They assert that the inclusion of ‘‘buildings’’ in section 2.55(a) therefore is at odds with the NOPR’s position that section 2.55(a) has never authorized the construction of auxiliary facilities on newly acquired right-ofway. Obviously, as Southern Star points out, a gas company is not going to be able to locate a large new headquarters building for hundreds of personnel within an existing right-of-way authorized for a pipeline.38 However, we do not agree that the inclusion of ‘‘buildings’’ in section 2.55(a) implicitly validates companies’ reliance on section 2.55(a) to construct even small buildings such as a tool shed on newly acquired right-of-way.39 While section 2.55(a) can be relied upon to construct housing for compression, communication, electrical and other equipment and facilities needed to operate pipeline systems, section 2.55(a) can only be relied upon when such structures can be located within existing or proposed rights-ofway or facilities’ site. Just as section 2.55(a) cannot be relied upon to install auxiliary facilities if a company will need to use a temporary work space that was not studied during a prior environmental review by the Commission, section 2.55(a) also is not intended for auxiliary installations where a gas company’s plans include other types of land use described by INGAA and National Fuel, such as construction of a new access road or the temporary use of previously undisturbed land to store pipe, equipment, or machinery. While the commentors point out that a company generally does not need certificate authority to acquire the land rights to construct an access road or to store 37 For example, a company that needs a larger right-of-way and more work space for pig launching equipment will not be able to install the equipment under its Part 157 blanket certificate if in the course of performing required surveys an endangered species is identified. In that case, the company may still be able to go forward with the project if it files an application for case-specific certificate authority, depending on the results of the Commission’s environmental review, including the required formal consultation with the U.S. Fish and Wildlife Service, and whether adequate mitigation measures to protect the endangered species can be fashioned. 38 Southern Star’s Comments at p. 4. 39 We note that a new corporate headquarters building is not a ‘‘natural gas facility’’ which requires certification under the NGA. VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 equipment and machinery, this makes no difference in whether a project qualifies under section 2.55(a). 23. Our goal is to ensure that the authorization provided by section 2.55 does not inadvertently work to deprive the Commission of the opportunity to conduct an environmental review and impose appropriate mitigation measures in any situation where a natural gas company’s construction activities may have adverse environmental impacts. Thus, even when all planned auxiliary facilities can be located entirely within an existing or proposed right-of-way, a project does not qualify under section 2.55(a) if construction of the auxiliary facilities will be undertaken in conjunction with other activities, such as building an access road or clearing and leveling nearby areas to store materials or equipment, that will occur outside the existing or proposed rightof-way and use areas that have not been environmentally reviewed in connection with the past or pending construction of other jurisdictional facilities. If a pipeline company plans to disturb any area in the process of constructing auxiliary facilities that was not or will not be subject to environmental review, the company must undertake the auxiliary installation under the Part 157 blanket certificate regulations or file an application for case-specific certificate authority so that the Commission has an opportunity to conduct an environmental study to consider related activities in the vicinity of the auxiliary installation activities, such as construction of an access road or use of land to store materials or machinery. 24. INGAA also comments on section 2.55(a)’s specification of ‘‘electrical and communication equipment,’’ a category that has expanded enormously since 1949. INGAA states that a communications tower qualifies as ‘‘electrical and communication equipment’’ and ‘‘typically involves erecting a 40-foot-tall, three-leg tower with associated microwave parabolic dish antennas, . . . may include a selfcontained communications building and backup generation,’’ and requires ‘‘a 40foot by 60-foot area that typically would not fit within a pipeline’s existing rightof-way.’’ 40 While we recognize it is unlikely the entire footprint of such a communication tower can fit within the confines of an existing authorized rightof-way or facility site, as noted above, we find that this example is as an exception to section 2.55(a) and not characteristic of all electric and communication equipment, some of 40 INGAA’s PO 00000 January 2013 Comments at p. 31. Frm 00010 Fmt 4700 Sfmt 4700 which can be installed within an existing right-of-way. As stated above, we cannot fulfill our NEPA responsibilities if we allow section 2.55(a) projects to use right-of-way and work space areas that have not been reviewed for environmental purposes. We have explained that if a structure is needed to ensure a company’s compliance with current regulations (e.g., safety, security, or reliability standards), but does not meet section 2.55 right-of-way/work space requirements, then the company must obtain blanket or case-specific certificate authorization for the project. 25. Moreover, the fact that these types of facilities are specifically listed in section 2.55(a) does not mean that companies can necessarily rely in all instances on section 2.55(a) to install them. 26. As discussed herein, when companies plan to construct auxiliary facilities in conjunction with projects for which they need to file applications under Part 157, Subpart A for casespecific certificate authority, section 2.55(a)(2)(iii) requires the companies to describe in the case-specific certificate proceedings any auxiliary facilities that they plan to install under section 2.55(a) and provide location maps.41 Thus, in a case-specific certificate proceeding, a company needs to include in the proposed right-of-way and temporary work spaces for which it seeks certificate authorization any additional areas it will need to install the planned auxiliary facilities, notwithstanding that it intends to rely on section 2.55(a) for its authorization to construct the auxiliary facilities. 27. In addition, if a company has already requested or received a casespecific certificate, or is constructing under its Part 157 blanket certificate subject to those regulations’ prior notice provisions, and decides prior to placing those facilities in service that it also wants to install auxiliary facilities, then section 2.55(a)(2)(ii) requires that the company give the Commission at least 30 days advance notice so that staff has time to consider any additional environmental impacts associated with the auxiliary facilities.42 The fact that section 2.55(a)(2)(ii) literally requires advance notice only if the auxiliary facilities are to be added to facilities that are not yet in service does not mean that companies can escape environmental review when they want to add auxiliary facilities to facilities that are already in 41 See n.9. 18 CFR 2.55(a)(2)(ii) (2103). The advance notification must include a description of the auxiliary facilities and their planned location. 42 See E:\FR\FM\04DER1.SGM 04DER1 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations wreier-aviles on DSK5TPTVN1PROD with RULES service. The installation of auxiliary facilities within previously-established rights-of-way and work spaces will be within the scope of a completed environmental review and conform to the mitigation measures resulting from that review, whereas the installation of auxiliary facilities outside of established rights-of-way or work spaces can impose unstudied (and thus unmitigated) environmental impacts, which is why section 2.55(a) and (b) activities must be restricted to rights-of-way, facility sites, and work spaces that have been reviewed and approved. 28. The commentors stress that in Arkla/NorAm and Order No. 603, the Commission focused its attention on section 2.55(b) and infer from this that the right-of-way/work space limitation that was explicitly applied to replacement facilities is implicitly inapplicable to auxiliary installations. This inference is incorrect. It was companies’ overly expansive reading of section 2.55(b), first noted and addressed in Arkla/NorAm, which prompted the Commission to revise section 2.55(b) in Order No. 603 to limit companies’ replacement project activities under that section to the use of existing rights-of-way and previously disturbed temporary work spaces. We were not aware, at that time, of companies also relying on section 2.55(a) to go outside previously authorized areas, in that case in order to add auxiliary facilities to existing facilities. Thus, when we issued Order No. 603, we had no reason to lay out our expectations regarding locational requirements as they pertained to auxiliary installations under section 2.55(a), even though we were clarifying those requirements with respect to replacement projects under section 2.55(b).43 29. However, over the last several years, we began to receive anecdotal indications that the industry might be applying an unwarrantedly expansive interpretation to section 2.55(a).44 In 43 As WBI Energy observes: ‘‘Section 2.55(b) projects can involve replacing dozens or even hundreds of miles of pipeline and transmission service related facilities. Section 2.55(a) auxiliary installations, on the other hand, are much smaller projects with limited scope such as pig launchers, valves and cathodic protection equipment.’’ WBI Energy’s Comments at p. 5. As we have observed: ‘‘Auxiliary installations and taps generally involve minor facilities; however, replacement of facilities may involve the removal and replacement of extensive mainline facilities.’’ Interim Revisions to Regulations Governing Construction to Facilities Pursuant to NGPA Section 311 and Replacement of Facilities, Order No. 525, 55 FR 33011 at 33013, FERC Stats. & Regs. ¶ 30,895 at 31,812 (1990). 44 Commission staff received questions from the industry inquiring whether it was appropriate to install certain facilities (including, but not limited VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 response, Commission staff—in conferences, meetings, and other public and private settings—sought to remind the industry that auxiliary installations, like replacement projects, must not stray outside of authorized rights-of-way and work spaces. While INGAA states that Commission staff’s consistent and insistent stance in this matter prompted its petition requesting that the Commission disavow staff’s statements, INGAA’s request for clarification also serves to highlight how the industry is improperly interpreting section 2.55(a) to undertake construction of facilities that do not qualify under that section because they involve siting the facilities and/or engaging in construction activities outside of authorized areas. 30. When Arkla/NorAm clarified that section 2.55(b) was restricted to replacements within the originally authorized right-of-way for the facilities being replaced, companies complained the Commission was upending longheld industry expectations and imposing an impractical constraint. Comments on the NOPR in this proceeding regarding auxiliary projects under section 2.55(a) recycle the objections presented on rehearing in Arkla/NorAm, namely: ‘‘the Commission failed to articulate the reason for its change in policy’’; ‘‘the Commission’s rationale underpinning’’ its ‘‘clarification is inadequate and inconsistent with the history and purpose of section 2.55(b)’’; the ‘‘clarification is unduly burdensome because it deprives pipelines of needed flexibility when repairing mainline facilities’’ and ‘‘that less burdensome alternatives are available’’; ‘‘clarification constituted an arbitrary and capricious action because it will create significant and unjustifiable regulatory burdens’’; and the right-of-way specification constituted a ‘‘rulemaking which failed to satisfy the notice and comment procedures of section 533 of the Administrative Procedure Act.’’ 45 31. The discussion, rationale, and result in the 1995 Arkla/NorAm rehearing could serve as our response to the comments on the NOPR. The Commission’s orders in Arkla/NorAm ‘‘aimed at removing any possible confusion within the industry to, cathodic protection equipment, pig launchers, communications equipment) outside of the company’s authorized right-of-way using section 2.55 authority. 45 Arkla/NorAm, 70 FERC ¶ 61,030 at 61,099. Later, when the Commission proposed to revise the text of section 2.55(b) to incorporate the Arkla/ NorAm clarification, comments emphasized the impracticality of corralling replacement construction activities within the originally authorized rights-of-way and workspaces. PO 00000 Frm 00011 Fmt 4700 Sfmt 4700 72801 concerning section 2.55’’ 46 by responding to the ‘‘mistaken belief ’’ 47 that section 2.55 permitted companies to replace obsolete facilities with new facilities outside rights-of-ways that were authorized for the facilities being replaced or to engage in any construction activities outside the existing right-of-way and previously disturbed work spaces. The clarification provided by the NOPR in this proceeding was aimed at the same mistaken belief on the part of some industry members with respect to section 2.55(a). Just as the Commission explained in Arkla/NorAm that, despite arguments to the contrary, it had ‘‘not changed its interpretation of what replacement facilities qualify’’ and can be installed under section 2.55(b),48 the clarification in the NOPR in this proceeding did not reflect a change in the Commission’s interpretation of what auxiliary facilities can be installed under section 2.55(a). Thus, we could have issued an instant Final Rule to codify our clarification of section 2.55(a) without providing notice and opportunity, just as the Commission has modified section 2.55 several times in the past without notice and comment when such actions were interpretive in nature.49 32. Until relatively recently, the Commission had always assumed that companies understood when they relied on section 2.55(a) to add auxiliary facilities to facilities already in service, the new auxiliary facilities must be attached or immediately adjacent to the existing facilities and within the rightof-way authorized for the existing facilities and no additional right-of-way or work space could be acquired or used in order to add the auxiliary facilities to the existing facilities.50 As we did in 46 Id., at 61,100. 47 Id. 48 Id. 61,099–100. Arkla/NorAm, the Commission noted previous amendments to section 2.55 that were treated as matters of interpretation, and as such implemented absent notice or hearing. Arkla/ NorAm, 70 FERC ¶ 61,030 at 61,100 and n.10, citing Order No. 220, 23 FPC 499 (1960) (including delivery taps as qualifying facilities for purposes of section 2.55); Order No. 241, 27 FPC 33 (1962) (revising the description of qualifying replacements for purposes of section 2.55); and Order No. 148– A, 49 FPC 1046, 1047 (1973) (excluding delivery points). Arkla/NorAm also cited, at n.11, American Mining Congress v. Mine Safety & Health Admin., 995 F.2d 1106, 1112 (D.C. Cir. 1993), which describes traits of interpretive rules, to show these modifications to section 2.55 constituted interpretations that, consistent with the APA, did not require notice or hearing. 50 See, e.g., Order No. 603–A, 64 FR 54522 at 54523, FERC Stats. & Regs. ¶ 31,081: ‘‘Traditionally, Section 2.55 limited the installation of auxiliary facilities to facilities installed on an existing 49 In E:\FR\FM\04DER1.SGM Continued 04DER1 72802 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations wreier-aviles on DSK5TPTVN1PROD with RULES Arkla/NorAm for section 2.55(b), we apply ‘‘a common-sense reading’’ to section 2.55(a) and reach the same conclusions as we did with respect to our prior clarification of section 2.55(b), so that those auxiliary and replacement activities that qualify for purposes of section 2.55, and therefore require no additional certificate authority, are ‘‘delineated by the parameters of the certificate’’ 51 authorizing the transmission facilities that will be made more efficient or economic by adding auxiliary facilities under section 2.55(a) or be replaced under section 2.55(b).52 33. Similarly under this common sense reading of section 2.55, we conclude that ‘‘to the extent that facilities are built outside the scope of the certificate, such facilities are unauthorized.’’ 53 Thus, if auxiliary facilities are to be added to existing or proposed interstate transmission facilities, the auxiliary facilities will qualify for purposes of section 2.55(a) only if they will be located within the same right-of-way as the transmission facilities 54 and construction activities will be limited to the temporary workspaces authorized for construction of the transmission facilities and conform to the conditions of the certificate authorizing construction of the transmission facilities (e.g., all required mitigation measures, such as erosion control or revegetation protocols, that applied to the casespecific certificate or Part 157 blanket certificate authority under which the transmission facilities were constructed).55 transmission system.’’ This holds for all section 2.55 facilities (including delivery points and taps during the period when they were covered under section 2.55), which have always been additions to or replacements of portions of a larger existing system, and as such have always been integrated into or substituted in place of jurisdictional facilities. 51 70 FERC ¶ 61,030 at 61,100. 52 Id. 53 Id. 54 Notice of Proposed Rulemaking, 68 FR 4120, FERC Stats. & Regs. ¶ 32,567 at 34,679. See also Emergency Reconstruction of Interstate Natural Gas Facilities Under the Natural Gas Act, Order No. 633, 68 FR 31596, at 31598–99 (May 28, 2003); FERC Stats. & Regs. ¶ 31,144, at 30,399 (2003). 55 The bounds of a section 2.55 facility’s authorization reflect the certificate conditions of the transmission system it modifies. For example, in Order No. 603–A, 64 FR 54522, FERC Stats. & Regs ¶ 31,081, at 30,921–22, the Commission was asked to permit section 2.55(b) projects to use ‘‘Commission-approved rights-of-way unrelated to the construction of facilities being replaced’’ on the grounds that ‘‘any existing right-of-way that has already been disturbed for pipeline construction, has been reviewed’’ for environmental impacts. The Commission rejected this request, reasoning that ‘‘the existing right-of-way that was used to construct the original facilities should be sufficient,’’ since replacements ‘‘should only VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 34. INGAA continues to argue that two Commission staff letters—one from 1984 and another from 1998—support INGAA’s position that current Commission staff has been implementing a change in Commission policy by telling companies that they cannot rely on section 2.55(a) to construct auxiliary facilities if they need additional right-of-way or previously undisturbed areas as work space. As discussed in the NOPR, INGAA describes the April 1998 letter signed by Commission staff as accepting a proposed section 2.55(a) installation of cathodic protection equipment outside the right-of-way for the existing pipeline facilities.56 We note that in December 1997, Commission staff had issued a letter addressing what appears to be the same proposed cathodic protection project. In this earlier letter, staff recited the requisite section 2.55 criterion ‘‘that, consistent with the Commission’s previous determinations regarding 18 CFR § 2.55(b), facilities constructed under section 2.55(a) must be placed within the permanent right-of-way.’’ 57 Staff explained in the December 1997 letter that because a portion of the project would be located ‘‘in a new right-of-way . . . in agricultural soil which was not previously disturbed by the pipeline construction,’’ 58 the project could not be installed under section 2.55(a); consequently, staff directed the company to ‘‘file an application under Section 7 of the Natural Gas Act for authorization.’’ 59 35. Neither the April 1998 follow-up letter cited by INGAA accepting the cathodic protection installation under section 2.55(a) nor anything else in the record states where the new facilities ultimately were located. INGAA assumes that the new equipment was installed in new right-of-way, since the December 1997 letter describes the ground beds as being outside the rightinvolve basic maintenance or repair to relatively minor facilities where the Commission has determined that no significant impact to the environment will occur.’’ The Commission noted that in most instances gas companies would be able to ‘‘use their blanket certificate authority to perform projects involving more extensive work that would need additional workspace, including the use of other unrelated rights-of-way,’’ since the blanket procedures ‘‘would allow for the required additional environmental scrutiny.’’ 56 Letter signed by the Director of the Commission’s Office of Pipeline Regulation, dated April 3, 1998; FERC eLibrary Accession No. 19980408–0242. 57 Letter signed by the Director of the Commission’s Office of Pipeline Regulations, dated December 16, 1997, p. 1 (citing Arkla/NorAm and Columbia Gas Transmission Corporation, 68 FERC ¶ 61,173 (1994), FERC eLibrary Accession No. 19971223–0120). 58 Id. 59 Id. PO 00000 Frm 00012 Fmt 4700 Sfmt 4700 of-way. We believe it is as likely that after receiving staff’s 1997 letter, the company determined that it could locate the ground beds within the same rightof-way containing the existing pipeline facilities, in which case staff’s December 1997 letter and April 1998 letter are consistent and correct; otherwise, as we acknowledged in the NOPR, the April 1998 letter did not reflect Commission policy correctly.60 36. The 1984 Commission staff letter identified by INGAA stated that proposed facilities to remove liquid condensate and free water could qualify as an auxiliary installation for purposes of section 2.55(a) as they would increase the efficiency and enhance the flexibility of the existing interstate pipeline system without altering the capacity of the system.61 INGAA emphasizes that staff’s letter reached this determination, notwithstanding that the letter’s description of the project indicated that some of the proposed facilities would be located outside the existing right-of-way. We find no indication that the location of the new facilities was taken into account in the one-page, two-paragraph staff letter which focuses exclusively on whether the new facilities would function, as the regulation requires, ‘‘only for the purpose of obtaining more efficient or more economical operation.’’ The order’s failure to recognize the site of some the of proposed facilities as outside of the existing right-of-way appears to have been be an oversight that led to a wrong result, since locating any of the planned new auxiliary facilities outside the existing right-ofshould have disqualified the project for purposes of section 2.55(a). 37. At most, INGAA has identified two instances where Commission policy may not have been applied correctly. Further, both examples cited by INGAA were staff letters; neither was a Commission order. INGAA cannot plausibly argue that these two questionable examples must be accepted as representing a clear statement of Commission policy, particularly when INGAA acknowledges it filed its request for clarification expressly because ‘‘[t]he Staff of the Federal Energy Regulatory Commission . . . has taken the position in informal conferences with pipelines and in industry meetings that Section 2.55(a) of the Commission’s regulations only applies to auxiliary installations in existing rights-of-way and where the 60 NOPR, FERC Stats. & Regs. ¶ 32,696 at P 11, n. 18 (cross-referenced at 141 FERC ¶ 61,228). 61 Trunkline Gas Company, Docket No. CP84– 394–000, letter order signed by the Director of the Commission’s Office of Pipeline Regulation, dated May 25, 1984. E:\FR\FM\04DER1.SGM 04DER1 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations wreier-aviles on DSK5TPTVN1PROD with RULES original work space is used,’’ 62 and because it strongly disagrees with ‘‘Commission Staff’s position . . . that the same right-of-way and work space requirements made expressly applicable to the replacement of facilities under Section 2.55(b) of the Commission’s regulations are implied requirements of Section 2.55(a).’’ 63 In any event, regardless of whether some companies have thought they had some reasonable basis for expecting that construction activities to add auxiliary facilities to existing facilities can extend outside the previously authorized areas for the existing facilities,64 we cannot fulfill our NEPA responsibilities if we allow companies to continue acquiring additional rights-of-way and work spaces to install auxiliary facilities under color of section 2.55(a) in areas not included in the environmental reviews for existing and proposed transmission facilities. We must ensure that environmental reviews are performed and appropriate mitigation measures identified, and this NEPA obligation extends to additional areas landowners may cede to gas companies for jurisdictional activities or facilities. 38. INGAA and WBI Energy point to the Commission’s document titled Guidance on Repairs to Interstate Natural Gas Pipelines Pursuant to FERC Regulations (Guidance Document), which states that ‘‘all replacement facilities must be constructed within the same right-of-way, compressor station, or other aboveground facility site as the facility being replaced,’’ but does not make a similar statement about auxiliary installations.65 INGAA maintains this omission ‘‘reinforces the decisions’’ made by Commission staff in the abovediscussed 1997 and 1984 letters. 39. We do not share this assessment. The Guidance Document’s summation of section 2.55, while highlighting the need for replacements to stay within authorized boundaries, does not include any discussion that would indicate auxiliary installations are intended to be exempt from this same constraint. The 62 INGAA’s April 2, 2012 Request for Clarification at p. 1, Docket No. RM12–11–000 (footnote omitted). 63 Id. 64 INGAA declares that ‘‘[f]or over six decades, the interstate pipeline industry has considered auxiliary installations beyond the right-of-way to be acceptable.’’ INGAA’s January 2013 Comments at p. 36. Echoing objections raised in Arkla/NorAm and Order No. 603, INGAA adds that our clarification ‘‘represents a sea change in how the industry will address such installations, thereby raising costs, limiting efficiencies, and threatening expedited enhancement of pipeline integrity by making such installations more difficult to effectuate.’’ Id. at 39. 65 See http://www.ferc.gov/industries/gas/geninfo/guidance.pdf, at p. 3 (2005). (An updated Guidance Document was issued in August 2013). VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 Guidance Document on repairs reflects the Commission’s experience with section 2.55 projects, which is that the scale and impacts of section 2.55(b) replacement projects (e.g., Arkla/ NorAm) can far exceed those of section 2.55(a) auxiliary installations. This is, as explained above, why we saw a need to spell out the right-of-way/work space restriction for replacements, and why— until recently—we had not recognized that there apparently is a need to do the same for auxiliary facilities. 3. Environmental Issues 40. INGAA contends the NOPR was incorrect in suggesting that all certificated gas facilities have undergone an environmental review prior to being constructed, because an environmental review was not a part of the Commission’s certificate proceedings until after NEPA’s promulgation in 1969. We acknowledge that NEPA altered the methodology employed by the Commission to evaluate the environmental impacts of a proposed project. For example, since NEPA, the Commission’s orders granting applications for construction authorization generally have included a separate section addressing the potential environmental impacts of an applicant’s proposed reasonable alternatives.66 However, the Commission has long recognized that determining whether proposed facilities are required by the public convenience and necessity requires that environmental consequences be taken into account (albeit in a far less methodical and thorough manner), and, when warranted, that constraints be imposed on projects’ location, construction, and operation. For example, while prior to NEPA the Commission did not require an applicant to search historical county and state records to identify old burial sites no longer clearly marked as we do today, the Commission would not have permitted an applicant to lay a pipeline across a visible cemetery and any approval for a pipeline to cross any isolated graves would have been conditioned on their appropriate relocation. 41. As the Commission observed in 1990 in adopting the advance notification requirement for more extensive replacement projects under section 2.55(b),67 when that section was 66 See Commission Regulations Implementing NEPA, 18 CFR part 380 (2013). 67 As discussed above, the 30-day advance notification requirement applies to a replacement project under section 2.55(b) if project costs will exceed the Part 157 blanket certificate regulations’ current cost limits for projects that qualify under the those regulations’ automatic provision. PO 00000 Frm 00013 Fmt 4700 Sfmt 4700 72803 promulgated in 1949 ‘‘there were fewer pipeline construction projects and the majority of those projects involved relatively short lengths of small diameter pipeline.’’ 68 The Commission explained that the advance notification requirement was needed because over the years ‘‘an integrated and sophisticated national pipeline gridwork has developed’’; and ‘‘[w]hereas replacement of facilities when § 2.55 was adopted could be assumed to involve minor projects, today, replacement of facilities could involve hundreds of miles of large diameter pipeline.’’ 69 The same reasoning holds for auxiliary installations, given the increase in the number, scale, and potential impacts of section 2.55 activities. 42. While our NOPR in this proceeding clarified that section 2.55(a) has always been limited to installations in authorized areas that have been or will be subject to environmental review, the NOPR also served to provide an opportunity for parties to convince us that this limitation is not necessary. Not only do INGAA’s comments not change our view, they serve to reinforce our belief that section 2.55 activities need to be confined to areas included within the existing right-of-way and previouslyused construction workspace by pointing out that section 2.55 can be relied upon to replace or add auxiliary facilities to transmission systems that were authorized prior to NEPA when the Commission’s environmental review would have been less rigorous and might not have identified project impacts that would come to light with today’s greater scrutiny. 4. Compliance With Executive Orders 43. The commentors claim the NOPR fails to follow Executive Orders directing agencies to weigh the burden 68 Interim Revisions to Regulations Governing Construction of Facilities Pursuant to NGPA Section 311 and Replacement of Facilities, Order No. 525– A, 53 FERC ¶ 61,140, at 61,467 (1990). 69 Id. The Commission also explained in Order No. 525–A that the advance notification requirement was needed for more extensive replacement projects under section 2.55(b) because changes could have occurred since an existing facility was put in place (e.g., the character of a region shifting from rural to residential), stating that: [J]ust because an area was disturbed when the pipeline was originally installed does not mean that replacing the old pipe with a new pipe will not potentially raise new environmental concerns. Such an action must be assessed in light of current land use, regulations, and concerns about erosion, sediment control, impact on streams and soil, threatened and endangered species and potential PCB contamination. E:\FR\FM\04DER1.SGM 04DER1 72804 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations wreier-aviles on DSK5TPTVN1PROD with RULES and benefit of regulations.70 They point out that section 2.55 was intended to avoid the burden of companies’ having to obtain case-specific certificate authorization for certain routine activities, and argue the purportedly new right-of-way/work space constraint will preclude some installations of auxiliary facilities under section 2.55(a), and so compel companies to instead submit more individual certificate applications. 44. We concur with the commentors’ characterization of section 2.55: it was put in place to, and continues to, reduce the burden that the industry (and Commission) would otherwise bear if every minor modification to a natural gas facility required case-specific certificate authorization. Further, while the Commission, as an independent agency, is not subject to the requirements of the cited Presidential documents, the Commission has directed staff to perform an internal assessment of the effectiveness of our regulations and is continually seeking to streamline the regulations in order to foster competitive markets, facilitate enhanced competition, and avoid imposing undue burdens on regulated entities or unnecessary costs on those entities or their customers.71 However, the NOPR, by more fully describing the types of activities that currently come within the bounds of 2.55(a), does not trigger any need for assessment of burdens and benefits, because the NOPR’s clarification regarding the scope of section 2.55(a) does not alter any aspect of the status quo. Where the NOPR’s proposed new regulations would impose an additional burden (e.g., the landowner notification requirements discussed below), then in accord with applicable Executive 70 Commenters cite Executive Order No. 13,563, Improving Regulation and Regulatory Review, 76 FR 3821 (January 21, 2011) (directing executive agencies and requesting that independent regulatory agencies such as the Commission ensure, inter alia, that their regulations have benefits justifying their costs and impose the least burden possible); Executive Order No. 13,579, Regulation and Independent Regulatory Agencies, 76 FR 41587 (July 14, 2011) (requesting that executive agencies, including independent regulatory agencies such as the Commission, retrospectively analyze their regulations and that regulations found to be outmoded, ineffective, insufficient, or excessively burdensome be modified, streamlined, expanded, or repealed); and Executive Order No. 13,211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use, 66 FR 28355 (May 22, 2001) (requiring agencies other than independent regulatory agencies such as the Commission to prepare Statements of Energy Effects describing the effects of certain significant energy actions on energy supply, distribution, or use). 71 See, e.g., Storage Reporting Requirements of Interstate and Intrastate Natural Gas Companies, Order No. 757, 77 FR 4220 (January 27, 2012), FERC Stats. & Regs. ¶ 31,327, at PP 12–13 (2012). VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 Orders, we explain the benefit we anticipate these new regulations will provide and quantify the burden we anticipate compliance will impose. 5. Section 2.55 Authorization and Part 157, Subpart F, Blanket Authorization 45. Under our Part 157, Subpart F blanket certificate regulations, as under our section 2.55 regulations, a gas company can construct and operate a limited class of facilities without the need to obtain separate certificate authorizations for each individual facility. INGAA, MidAmerican Energy, and National Fuel point to section 157.202(b)(3) of our blanket certificate regulations, which in designating the types of facilities that may qualify for blanket authorization, states: ‘‘‘Facility’ does not include the items described in section 2.55.’’ 72 MidAmerican Energy is apprehensive this could be interpreted to mean that if an auxiliary facility does not qualify under section 2.55(a) because it does not meet the right-ofway/work space constraints, then it also could not qualify as an eligible facility under the blanket regulations because of the section 157.202(b)(3) limitation, thereby leaving a company with the ‘‘only option’’ of filing an application for case-specific certificate authorization.73 46. The Commission responded to a similar concern in 1999 in the Order No. 603 proceeding that codified the Arkla/ NorAm clarification regarding replacement projects under section 2.55(b) by amending that section to add the phrase ‘‘will be located in the same right-of-way or on the same site as the facilities being replaced, and will be constructed using the temporary work space used to construct the original facility.’’ 74 The Commission explained that section 157.202(b)(3) only prevents companies from relying on their Part 157 blanket certificates to construct facilities if the facilities qualify under section 2.55. As clarified by Order No. 603’s revision to section 2.55(b), replacement projects are disqualified under that section only if they will use additional right-of-way or work space than was used in constructing the facilities being replaced or will result in an incidental increase in capacity. Thus, section 157.202(b)(3) prevents companies from relying on their Part 157 certificates for replacement projects that will not use additional right-of-way 72 18 CFR 157.202(b)(3)(2013). Energy’s Comments at p. 11. 74 Order No. 603, 64 FR 26572, FERC Stats. & Regs. ¶ 31,073. 73 MidAmerican PO 00000 Frm 00014 Fmt 4700 Sfmt 4700 or work space and therefore qualify under section 2.55.75 47. Both section 2.55 and the blanket certificate program are intended to provide a streamlined authorization process to avoid the comparatively greater time, cost, and effort that accompany a case-specific section 7 certificate application.76 To this end, we expect companies seeking to install, maintain, replace, repair, or upgrade facilities to look first to section 2.55, and only if an activity is beyond the scope of that section then to turn to blanket certificate authority, and only if an activity would exceed blanket authority, then to file for case-specific section 7 authorization. 48. INGAA and National Fuel note we modified section 157.202(b)(2)(i) to specify that replacements which do not meet section 2.55(b) requirements may be eligible for blanket authorization 77 and request we do the same for auxiliary installations. We will do so (although we believe this does not change the way the regulations currently function) to ensure clarity and consistency in the application of the regulations.78 Accordingly, to explicitly (and redundantly) specify that auxiliary installations which do not meet section 2.55(a) requirements may be eligible for blanket authorization, we will add the following sentence at the end of section 157.202(b)(2)(i): ‘‘Eligible facility includes auxiliary installations and observation wells which do not qualify under § 2.55(a) of this chapter because 75 Order No. 603, 64 FR 26572 at 26580, FERC Stats. & Regs. ¶ 31,073. 76 While section 2.55 covers a more limited range of facilities than the blanket program, it offers lighter-handed regulatory oversight than the blanket program. 77 Order No. 603 revised 157.202(b)(2)(i) to specify that eligible facilities include ‘‘replacements that do not qualify under section 2.55(b) of this chapter because they will have an impact on mainline capacity.’’ Order No. 603, 64 FR 26572 at 26579–80, FERC Stats. & Regs. ¶ 31,073. 78 We note that in instances where a pipeline company needs to rely on its Part 157 certificate to construct auxiliary or replacement facilities because they do not satisfy the location or work space limitations of section 2.55, the Part 157 blanket certificate regulations impose no limitations on the placement of the facilities. While the Commission has indicated previously that it is contemplated that replacement facilities constructed under blanket authority would usually be located adjacent to, if not within, an existing right-of-way, sections 157.202(b)(2)(i) and 157.210 permit the construction of non-main line facilities and main line facilities, respectively, without restriction on their location. For example, a company can rely on its Part 157 blanket certificate to replace the capacity of a segment of obsolete pipeline with new pipeline that may need to be located at considerable distance from the old pipeline in order to avoid a housing development constructed since the old pipeline was installed or to install auxiliary facilities such as anodes offset from the existing right-of-way to provide cathodic protection. E:\FR\FM\04DER1.SGM 04DER1 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations require that such facilities obtain blanket or case-specific certificate authorization. 6. ‘‘Grandfathering’’ Existing Section 2.55(a) Installations 49. For the reasons discussed above, we believe modifying section 2.55(a) to codify right-of-way and work space constraints does no more than restate existing Commission policy and practice. Nevertheless, we acknowledge that although these constraints have been clear to the Commission, they may have been subject to misinterpretation by the industry. 50. The commentors declare companies have relied on section 2.55(a) to install facilities that are not in compliance with right-of-way and work space requirements. As explained above, any such installations are NGAjurisdictional facilities constructed and operated without NGA authority. However, given that section 2.55(a) did not previously include an explicit description of the inherent right-of-way/ work space constraint, and in view of commentors’ claims of companies’ good faith reliance on section 2.55(a) to install facilities which violate this constraint, we will not require the companies to obtain a blanket or casespecific certificate authorization for thefacilities purportedly installed pursuant to section 2.55(a) prior to the effective date of this rule, provided such facilities comply with all other applicable federal, state, and local rules and regulations. That said, if we become aware of facilities installed relying on section 2.55(a) that do not meet the constraints of that section which are the cause of any significant adverse environmental impact, we may then wreier-aviles on DSK5TPTVN1PROD with RULES they will not satisfy the location or work space requirements of § 2.55(a).’’ 79 7. Burden of Section 2.55’s Right-of-Way Requirement 51. INGAA argues that we erred by not including the ‘‘additional time and burden’’ of blanket or case-specific section 7 procedures that will now be necessary for facilities that cannot meet section 2.55(a) siting requirements.80 This objection presumes the section 2.55(a) right-of-way/work space constraint constitutes a new burden imposed by this rule. As previously discussed, this not the case, because section 2.55 activities have always been restricted to an authorized right-of-way or facility site and prescribed work spaces. Activities that exceed these limits are not covered under section 2.55, and thus no additional time and burden is being imposed—they remain subject to the same time and burden that they were before. Consequently, we do not include activities that did not and will not qualify under section 2.55(a) in our estimate of the additional time and burden imposed by this rule. 52. INGAA asserts the ‘‘NOPR would convert all auxiliary installations outside of existing rights of way and historical work spaces into Natural Gas Act jurisdictional facility construction that would require certificate authorization and formal agency consultation.’’ 81 We concur, but as noted, we will not compel companies to seek blanket or case-specific authorization for facilities installed in erroneous reliance on section 2.55(a) unless we find reason to suspect such facilities are a cause of significant adverse environmental impact. Where facilities already in place present no such issues, we find no reason to subject them to further review. 53. In any event, the NOPR and this Final Rule do no more than clarify the source of our authority over certain types of facilities. Therefore, we reject INGAA’s claim that we include an estimate of the burden on companies of filing certificate applications and consulting with environmental agencies for facilities allegedly ‘converted’ to blanket or case-specific status. 79 In 1999, the Commission proposed adding the following sentence at the end of section 157.202(b)(2)(i): ‘‘Eligible facility includes observation wells.’’ Landowner Notification, Expanded Categorical Exclusions, and Other Environmental Filing Requirements, Notice of Proposed Rulemaking, 64 FR 27717 (May 21, 1999), FERC Stats. & Regs. ¶ 32,540 (1999). Ultimately, the Commission elected not to include the sentence based on its conclusion at the time that observation wells could be constructed under section 2.55(a). Landowner Notification, Expanded Categorical Exclusions, and Other Environmental Filing Requirements, 64 FR 57374 (October 25, 1999), FERC Stats. & Regs. ¶ 31,082, at 30,959 (1999). Commentors in this proceeding have pointed out that many observation wells, rather than being drilled to monitor operations at an existing gas storage facility, are drilled in order to determine whether a planned new storage facility is feasible, in which case a company may not have any existing right-of-way and would not be able to meet section 2.55(a) requirements. In view of this, we will include observation wells in revised section 157.202(b)(2)(i) to ensure that if such wells are not able to meet section 2.55(a) siting restrictions, they will then be eligible to be considered for authorization under the blanket certificate program. VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 B. Landowner Notification 54. This Final Rule adopts regulations to provide for advance landowner notification for auxiliary and replacement projects under section 2.55 and for maintenance activities under section 380.15. As previously discussed, 80 INGAA’s 81 INGAA’s PO 00000 March 2013 Comments at p. 5. March 2013 Comments at p. 22. Frm 00015 Fmt 4700 Sfmt 4700 72805 we consider it appropriate to give landowners prior notice to the extent practicable before intruding onto their property as a courtesy and to avoid potential conflict between landowners and gas companies. Commentors do not dispute the virtues of informing landowners of company activities, but insist the notice procedures described in the NOPR are impractical. 55. In response to commentors’ concerns, we will revise the proposed notification obligations to (1) specify the types of maintenance activities that merit individual notice; (2) limit notice to landowners whose property is crossed or used for section 2.55 and section 380.15 activities; and (3) reduce the prior notice period from 10 days to five days. These modifications should significantly diminish the burden of complying with the new requirements for prior notice to landowners. 56. Instead of mandating notice to landowners for all section 380.15 maintenance activities, as proposed in the NOPR, we will only require prior notice of those more substantial activities that will result in ground disturbance. In addition, we are reducing the scope of notification proposed in the NOPR, which would have required that notice be provided not only to directly affected landowners, but also to adjacent landowners and to landowners with a residence within 50 feet of a proposed work area.82 Commentors assert this is overly broad and request that we remove abutting landowners and landowners with a residence within 50 feet of the proposed work area from the definition of ‘‘affected landowners.’’ Although the NOPR would have required the same scope of notice that companies are required to provide for projects under the Part 157 blanket certificate regulations, the commentors have convinced us that more limited landowner notification requirements are appropriate for companies’ activities under section 2.55 and 380.15, since such projects are likely to be smaller, take a shorter period of time to 82 The NOPR defined ‘‘affected landowners’’ for purposes of companies’ activities under sections 2.55 and 380.15 as ‘‘owners of property interests, as noted in the most recent tax notice, whose property (1) is directly affected (i.e., crossed or used) by the proposed activity, including all rightsof-way, facility sites, access roads, pipe and contractor yards, and temporary work space; or (2) abuts either side of an existing right-of-way or facility site, or abuts the edge or a proposed rightof-way or facility site which runs along a property line in the area in which the facilities would be constructed, or contains a residence within 50 feet of the proposed construction work area.’’ 78 FR at 683, NOPR, FERC Stats. & Regs. ¶ 32,696 at P 30 (corss-referenced at 141 FERC ¶ 61,228). E:\FR\FM\04DER1.SGM 04DER1 72806 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations accomplish, and be less disruptive than blanket certificate projects. 57. Finally, while the NOPR stipulated a 10-day prior notice, we accept commentors’ claim that some activities, particularly unanticipated maintenance, are not scheduled far enough in advance to allow for a 10-day prior notice.83 In view of this, we will only require that landowners receive notice five days in advance of initiating certain activity under section 2.55 or 380.15, which we anticipate will still allow time for landowners and a company to discuss any concerns landowners may have regarding companies’ planned activities. wreier-aviles on DSK5TPTVN1PROD with RULES 1. Jurisdictional Basis and Need for Landowner Notification 58. INGAA asserts that the Commission has no jurisdictional basis to impose landowner notification requirements for companies’ installations of auxiliary facilities and replacement projects under section 2.55 or their maintenance activities under section 380.15; 84 therefore, INGAA argues that the NOPR’s proposed landowner notification requirements for these activities should not be adopted. However, if the Final Rule does adopt landowner notification requirements, INGAA asks the Commission to explain what circumstances changed since the promulgation of Order No. 609 85 to merit mandatory prior notification to landowners before a company commences construction under section 2.55 or maintenance under section 380.15. 59. INGAA points out 86 that in Order No. 609 the Commission determined that there was no need for landowner notification because section 2.55(b) replacements occur within an ‘‘existing 83 Additionally, commentors state that the 10-day prior notice period prevents companies from adjusting maintenance schedules due to weather, equipment availability, permitting processes, etc. 84 INGAA’s March 2013 Comments at p. 7. INGAA cites to Californians for Renewable Energy, Inc., 133 FERC ¶ 61,194, at P 26 (2010), to support its statement that ‘‘[t]hus far, the Commission properly has refrained from exercising jurisdiction over easement or right-of-way agreements, and has appropriately deferred the formal resolution of disputes in such matters to the courts.’’ We agree that formal resolution of disputes over the terms of easements and right-of-way agreements belong in the courts and we are not claiming jurisdiction over these matters by imposing landowner notification requirements for Commission-authorized activities. 85 Order No. 609, 64 FR 57374 (October 25, 1999), FERC Stats. & Regs. ¶ 31,082 (1999). 86 INGAA’s March 2013 Comments at pp. 6–7. INGAA also notes that ‘‘[a] pipeline must own the property or have an easement to perform maintenance, and the same is true for a pipeline to install, modify, replace, improve, alter, operate, maintain, access, inspect, patrol, protect, abandon, etc. auxiliary installations and replacement facilities.’’ Id. at p. 12. VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 right-of-way and subject to an existing easement agreement, which dictates the pipeline’s right to obtain access to maintain the facilities.’’ 87 However, Order No. 609 also stated that ‘‘prudence would dictate that the pipeline should give the landowner as much advance warning as possible to avoid misunderstandings and illwill.’’ 88 60. Our proposal in the NOPR in this proceeding to adopt landowner notification requirements for companies’ activities under section 2.55 and section 380.15 was prompted by landowners’ expressions of concern to Commission staff during phone inquiries, scoping meetings, and in other forums due to companies’ personnel appearing unannounced on or near their property. The types of concerns expressed by landowners arise from construction and maintenance crews arriving unexpectedly to engage in activities that disrupt, or could disrupt, landowners use of their property, or damage their property as a result of replacing facilities; re-grading or replacing access roads; lowering pipelines; performing anomaly digs; or preventing and controlling erosion. We view providing prior notice, which some companies avow is routine practice, as the least burdensome and most practical way to ensure courtesy and preclude conflicts with landowners. Whenever a company conducts an activity subject to our jurisdiction and under authority provided by our regulations,89 we have a right and responsibility to impose appropriate and reasonable conditions on that activity.90 Our responsibility includes 87 Order No. 609, 64 FR 57374 at 57382, FERC Stats. & Regs ¶ 31,082. 88 Id. 89 In addition, section 157.14(a)(9)(iv) of the Commission’s regulations requires an applicant for NGA section 7 certificate authority to certify that it will ‘‘maintain the facilities for which a certificate is requested in accordance with Federal safety standards.’’ 18 CFR 157.14(a)(9)(iv) (2013). Likewise, NGA section 7(h) gives the certificate holder eminent domain authority to acquire rights necessary to ‘‘construct, operate, and maintain a pipe line.’’ 15 U.S.C. 717f(h) (2012). See Brian Hamilton, 141 FERC ¶ 61,229, at PP 24–25 (2012) (Hamilton). Therefore, the Commission has jurisdiction over maintenance activities, and has the authority to require landowner notice as a condition of a company’s jurisdictional maintenance activities. 90 Contrary to National Fuel’s assertion (see National Fuel’s Comments at p. 2), the Commission is not restricted to requiring landowner notification only for companies’ activities under their Part 157 blanket and case-specific certificates. As discussed supra PP 13–16 auxiliary and replacement facilities are NGA-jurisdictional facilities that can be constructed only with the requisite section 7 certificate authority, which the Commission provided when it adopted section 2.55 as a precursor to the Part 157 blanket certificate PO 00000 Frm 00016 Fmt 4700 Sfmt 4700 ensuring that, to the extent practicable, landowners are informed in advance when they may be inconvenienced or the use of their property may be disrupted by companies’ jurisdictional activities to construct auxiliary and replacement facilities under section 2.55 authority or conduct maintenance activities subject to section 380.15. Landowners deserve an opportunity to express concerns, and we want the opportunity to act on those concerns if necessary.91 61. Commentors assert that easement agreements are the proper method for landowners to establish any requirements for prior notice of company activities on private property,92 and note that many of these agreements specify that no notice is required for maintenance activities. While we recognize that some landowners agree to forego prior notice, we nevertheless believe it is prudent for gas companies to provide such notice. Landowners may misunderstand the terms of an easement agreement or a subsequent owner may not be aware that the land is subject to an easement. Therefore, regardless of whether an easement agreement gives a company a right enforceable under state property law to enter on property without notice, we believe it is appropriate and reasonable for our regulations to require that to the extent practicable companies provide landowners with prior notice construction program. Further, the authorization to perform maintenance on gas facilities comes from the certificate authority under which the facilities were or will be constructed—whether it be selfimplementing section 2.55 certificate authority, Part 157 blanket certificate authority, or case-specific certificate authority. As the Commission explained in Hamilton, 141 FERC ¶ 61,229, at P 24, ‘‘[i]t does not necessarily follow, however, that [a natural gas company] has no responsibilities merely because the activity neither falls within the replacement of facilities under section 2.55(b) nor under the blanket construction provisions. When the Commission authorizes a natural gas company to construct and operate pipeline facilities, the authority must necessarily include authority to maintain the pipeline.’’ 91 National Fuel argues that the NOPR relied on NEPA as a basis for requiring landowner notification for maintenance activities. National Fuel’s Comments at p. 3. It did not. The rationale for requiring notification is our belief that landowners should be informed in advance of any activity that will take place on their property as a consequence of our granting a company an NGA section 7(c) certificate. The jurisdictional basis for this requirement is as a condition to the certificate, which we impose to ensure company actions are consistent with the public interest. The NOPR, however, did rely on NEPA as a basis for restricting companies’ activities to areas subject to an environmental review, and as a result thereof, authorized for a particular use. 92 See INGAA’s March 2013 Comments at pp. 6 and 12, Southern Star’s Comments at p. 6, Golden Triangle’s Comments at p. 4, WBI Energy’s Comments at p. 7, and National Fuel’s Comments at pp. 2–3. E:\FR\FM\04DER1.SGM 04DER1 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations before commencing certain activities under section 2.55 or section 380.15. 2. Exceptions to Landowner Notification Requirements 62. Commentors state that if the landowner notification proposals are adopted, the Final Rule should waive landowner notification to provide ‘‘for immediate access to emergency gas leaks, acts of God, investigations related to gas pressure or flow or SCADA signals, or to respond to One Call notifications on an emergency or routine basis.’’ 93 63. Our regulations provide for a company to take immediate action in an emergency, as we pointed out in response to a similar concern regarding the imposition of a 30-day prior notice: [This] rule does not override other Commission regulations which permit interstate pipelines to take prompt corrective actions to address conditions that constitute a safety hazard. Subpart I of Part 284 of the Commission’s regulations exempts emergency situations from the provisions of section 7 of the Natural Gas Act and permits a pipeline to take immediate action to alleviate an emergency situation subject to a subsequent 48-hour reporting requirement. Section 284.262(a)(1)(iii) of Subpart I defines emergency as ‘‘Any situation in which . . . immediate action is required or is reasonably anticipated to be required for the protection of life or health or for maintenance of physical property.’’ 94 Notwithstanding the foregoing, to assure there will be no hesitation by gas companies if immediate action is called for, we will specify in sections 2.55 and 380.15 that: ‘‘For an activity required to respond to an emergency, the five-day prior notice period does not apply.’’ Note that events that do not necessitate immediate access to system facilities would not trigger our section 284 emergency provisions, and therefore would still be subject to a five-day prior notice. wreier-aviles on DSK5TPTVN1PROD with RULES 3. Part 157 Landowner Notification Exemption for Replacement Projects 64. Companies are required to provide landowner notice prior to initiating projects under the Part 157 blanket certificate regulations.95 However, section 157.203(d)(3)(i) of the 93 INGAA’s March 2013 Comments at p. 9 and National Fuel’s Comments at p. 5. 94 Interim Revisions to Regulations Governing Construction of Facilities Pursuant to NGPA Section 311 and Replacement of Facilities, 52 FERC ¶ 61,252, at 61,877 (1990). See also section 157.203(d)(3)(i), which states that ‘‘no landowner notice is required’’ for any blanket program ‘‘replacement done for safety, DOT compliance, environmental, or unplanned maintenance reasons that are not foreseen and that require immediate attention by the certificate holder.’’ 95 18 CFR 157.203(d)(1) (2013). VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 regulations provides a notice exemption for replacement projects that would have been done under section 2.55(b), but for the fact that the replacement projects are not of the same capacity.96 To provide consistency with new the section 2.55 landowner notification requirements established in this Final Rule, we will amend section 157.203(d)(3)(i) to provide that replacement projects that would have been done under section 2.55(b), but for the fact that the project alters the designed delivery capacity of the original facility, remains exempt from the landowner notification requirements of Part 157, as long as the project does not involve ground disturbance. Because the revised section 2.55(b) notice requirements require landowner notice for a ground disturbing replacement project that substitutes in a new same-size facility, it would be inconsistent to retain the landowner notice exemption in section 157.203(d)(3)(i) for a ground disturbing replacement project that alters the capacity of the original facility. 4. Requirement That Notification Inform Landowners of the Availability of the Commission’s Dispute Resolution Division 65. WBI Energy states that any landowner notification requirements should not include a requirement that companies provide landowners with contact information or include a description of the Commission’s Dispute Resolution Division (DRD) Helpline. WBI Energy asserts disputes concerning easements and right-of-ways for existing facilities are properly adjudicated in state courts, and not by the Commission. WBI Energy further argues that including information regarding the DRD in the notice likely would cause landowners to incorrectly believe that the Commission is the appropriate venue for resolving property disputes.97 66. We recognize that the DRD Helpline is not the appropriate venue for determining the respective rights of companies and landowners under state property law or for renegotiating the terms of easement agreements. However, there are instances in which it is appropriate and/or potentially helpful for landowners to contact Commission staff to seek informal resolution of a dispute. For example, while a court would be the appropriate forum to adjudicate a dispute regarding whether 96 18 CFR 157.203(d)(3)(i) (2013). To qualify under section 2.55(b) a replacement project must have a substantially equivalent designed delivery capacity as the original facility. 18 CFR 2.55(b)(1)(ii) (2013). 97 WBI Energy’s Comments at pp. 8–9. PO 00000 Frm 00017 Fmt 4700 Sfmt 4700 72807 an easement agreement gives a natural gas company the right to allow another company to lay a fiber optic cable in the pipeline right-of-way, or to determine the amount of monetary damages caused to a landowner’s property by a company’s negligence during construction activities, it is appropriate for a landowner to contact the Commission if the landowner believes that a company’s planned activities might not comply with the provisions of section 2.55 (e.g., may not be confined to the existing right-of-way) or section 380.15 and for the Commission’s staff to contact the company regarding the matter. It also is appropriate for a landowner to seek the Commission’s assistance in obtaining a company’s voluntary agreement to reasonable accommodation requested by the landowner (e.g., to reschedule backhoe digging planned by the company for the same day as a back-yard wedding reception). In this regard, we emphasize that section 380.15(b), Landowner consideration, states that ‘‘[t]he desires of landowners should be taken into account in the planning, locating, clearing, and maintenance of rights-ofway and the construction of facilities on their property.’’ 67. While only a court can determine the respective rights of a company and landowner under the terms of an easement agreement, the terms of an easement in no way diminish the Commission’s NGA authority over companies’ activities to construct or maintain jurisdictional facilities. Thus, we are adopting our proposal to require that companies include the DRD Helpline number to facilitate landowners being able to contact and seek assistance from Commission staff. We encourage companies to describe the DRD Helpline as a way for landowners to inform the Commission of concerns regarding a company’s planned activities. We anticipate companies, in providing the DRD Helpline number, will be able to explain this without implying, as WBI Energy worries, that a company is acting unlawfully.98 5. Landowner Notification for Maintenance Activities 68. Commentors state that the Commission’s proposed prior notice 98 Id. In Order No. 609, in response to similar apprehensions regarding a requirement for companies to include information in landowner notices on how to contact the Commission’s Enforcement Hotline, we stated we did not believe ‘‘that including a reference to the Enforcement Hotline implies the company is doing something unlawful,’’ and added that we expected companies ‘‘will be able to present it as merely being a means to contact the Commission, which is in fact what it is.’’ 64 FR 57374, 57384. E:\FR\FM\04DER1.SGM 04DER1 72808 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations requirements for maintenance activities may be unnecessary in view of existing U.S. Department of Transportation (DOT) regulations. DOT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) requires pipelines to develop a continuing public education program,99 which follows guidance provided by the American Petroleum Institute’s (API). Recommended Practice 1162.100 API’s Recommended Practice 1162 requires that ‘‘[w]hen planning pipeline maintenance-related construction activities,’’ gas companies ‘‘should communicate to the audience affected by the specific activity in a timely manner appropriate to the nature and extent of activity,’’ 101 and must also notify landowners in writing biennially of all ‘‘planned major maintenance/ construction activity.’’ 102 69. We accept that the PHMSA requirements will be sufficient to alert landowners to many maintenance activities. We will therefore modify the prior notice requirement for section 380.15 maintenance activities proposed in the NOPR in this proceeding by limiting notice to maintenance activities that will cause ground disturbance.103 Given the potential disruption and impact level of maintenance activities that will cause ground disturbance, we find such activities merit separate written notice to affected landowners. 70. While some of these activities will be included in the PHMSA-mandated biennial report distributed to landowners, we have no assurance that all such activities will be. Further, while the PHMSA report of planned major maintenance can provide a broad overview of a company’s future operations, because the company only issues this report every other year, it does not give landowners a sufficiently precise description of when a particular activity will commence and conclude. We believe that if landowners have notice five days before a ground disturbing project begins, this will enable companies and landowners time to confer, coordinate, and avoid simultaneously undertaking incompatible actions. Finally, we note 99 See 49 CFR 192.616 (2013). http://mycommittees.api.org/standards/ pipeline/1162%20Links/1162nonprintable.pdf. 101 See http://mycommittees.api.org/standards/ pipeline/1162%20Links/1162nonprintable.pdf, sections 4.10 and C.10. 102 Id. See Table 2–1, Summary of Public Awareness Communications for Hazardous Liquids and Natural Gas Transmission Pipeline Operators. 103 However, if in the future, we receive objections indicating that landowners are not adequately informed of particular maintenance activities, we may consider applying a separate prior notice requirement specific to such activities. wreier-aviles on DSK5TPTVN1PROD with RULES 100 See VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 that PHMSA is focused on the safe operation of existing facilities, whereas the Commission purview of the public interest covers a broader set of concerns. Thus, while PHMSA may find no cause to take into account a company’s activity that inconveniences a landowner but does not compromise the safe operation of gas facilities, the Commission may find such an activity to be within the scope of its authority to ensure the activity is consistent with the public convenience and necessity. 71. MidAmerican Energy and Golden Triangle request that the Commission provide a definition of maintenance under section 380.15 of the regulations.104 Golden Triangle states that any time its personnel enter the right-of-way for periodic routine activities (e.g., pipe-to-soil readings, leak patrols, surveillance patrols, meter station inspections, and walking the pipeline right-of-way), a landowner will construe that entrance as a maintenance activity.105 72. We see no need to craft a definition describing all maintenance activities, although we can say that we do not share Golden Triangle’s apparent view that an intrusion by company personnel onto a landowner’s property for monitoring purposes is not ‘‘maintenance’’ so long as the monitoring does not lead to any additional activity during the same intrusion. We consider all of the activities identified by Golden Triangle to be maintenance. However, as stated above, we are scaling back the NOPR’s proposal so that prior notice to landowners will only be required for ground disturbing maintenance activities. Thus, while we believe Golden Triangle’s examples are maintenance activities, as long as these minor activities do not cause ground disturbance, they will not trigger any Commission requirement for advance notice to landowners. 6. Burden Resulting From Notification Requirement 73. Commentors argue that the NOPR did not fully analyze the expense and burden associated with requiring landowner notification for auxiliary, replacement, and maintenance activities.106 INGAA stresses that maintenance alone entails hundreds of thousands of property visits per year, and that to track these activities company personnel would have to write 104 MidAmerican Energy’s Comments at p. 5 and Golden Triangle’s Comments at p. 9. 105 Golden Triangle’s Comments at pp. 9–10. 106 INGAA’s March 2013 Comments at pp. 21–25, Southern Star’s Comments at pp. 5–6, and National Fuel’s Comments at p. 2. PO 00000 Frm 00018 Fmt 4700 Sfmt 4700 descriptions of each activity, visit the site to determine if new residences were installed since the last patrol, hire a land agent to identify all affected and abutting landowners, and craft and mail formal letters.107 74. Golden Triangle asserts that the expense of complying with the proposed landowner notification requirements will have a significant impact on small entities.108 Golden Triangle states that compliance with the landowner notification requirements will include increased costs to hire either a contractor or full-time employee, to create a database or purchase specialty software, and to mail out letters to all of its right-of-way easement holders.109 75. WBI Energy and National Fuel argue that the Commission underestimated the amount of time it will take companies to prepare the notices.110 WBI Energy and INGAA state that the NOPR’s estimate that there will be three times as many maintenance projects as section 2.55 projects is a gross underestimation.111 National Fuel insists that the NOPR’s estimate that the entire industry will spend 39,000 hours to satisfy the notification requirement is low. National Fuel predicts that it will be required to spend approximately six hours to prepare and deliver notices to all affected landowners for each maintenance activity.112 Golden Triangle asserts it will spend at least 16 hours on 250 letters for mowing or noxious weed control, in addition to the eight hours it estimates will be required to research, update, and prepare separate letters for abutting landowners.113 In addition, MidAmerican Energy states that the landowner notification requirement will impose varying burdens on individual pipelines based on the activity undertaken. For example, it estimates that farm tap installation and maintenance will require 5,400 letters per year; check, operate, and lubricate maintenance will require 30,000 letters 107 INGAA’s March 2013 Comments at p. 10. Triangle claims it is a small entity, which the Small Business Administration (SBA) Office of Size Standards defines a natural gas company transporting natural gas as small if its annual receipts are less than $25.5 million. See 13 CFR § 121.201 (2013), Subsector 486 and SBA’s Table of Small Business Size Standards, effective March 26, 2012, available at: http://www.sba.gov/ sites/default/files/files/Size_Standards_Table.pdf. 109 Golden Triangle’s Comments at pp. 7–8. 110 WBI Energy’s Comments at p. 11 and National Fuel’s Comments at p. 4. 111 WBI Energy’s Comments at p. 11. 112 National Fuel’s Comments at pp. 4–5. 113 Golden Triangle’s Comments at p. 9. 108 Golden E:\FR\FM\04DER1.SGM 04DER1 wreier-aviles on DSK5TPTVN1PROD with RULES Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations per year; and leak detection surveys will require 7,700 letters per year.114 76. We acknowledge that given the wide range of maintenance activities described by commentors, we may have underestimated the burden of providing prior notice to landowners that would have resulted from the NOPR’s proposal to require that companies notify landowners, including abutting landowners, prior to commencing any activities under section 2.55 or section 380.15. However, as discussed above, we are limiting the requirement for prior notice to activities that will involve ground disturbance. In addition, we are eliminating the proposed requirement that companies give prior notice to abutting landowners and to landowners with a residence within 50 feet of a proposed work area. 77. We believe these modifications to the NOPR’s proposed notice requirements will alleviate the concerns for the majority of the activities cited by commentors. As a result, we will use a multiplier of two times the number of all regulated companies’ estimated annual auxiliary installations under section 2.55(a) 115 as a reasonable estimate of the total annual number of auxiliary installations, replacement projects, and maintenance activities that will require prior notice to landowners because the activities will result in ground disturbance. We acknowledge that basing the estimated total number of activities requiring prior notice on regulated companies’ estimates of the number of section 2.55(a) auxiliary installations undertaken annually is not going to yield the same number as basing our estimate on on-site surveys or other verifiable data; nevertheless, we believe our estimate is reasonable and is as accurate an estimate as can be readily established for purposes of calculating the anticipated burden. 78. As discussed herein, we are also responding to companies’ concerns that it is often impractical to notify landowners at least 10 days prior to the start of any section 2.55 or section 380.15 activity, as the NOPR’s proposal would have required. By requiring that notice be received five days and not 10 days prior to undertaking any activity, and limiting notice to only ground disturbing rather than all section 2.55 and section 380.15 activities, we believe companies will be subject to the minimal inconvenience necessary to 114 For maintenance activities on their systems, WBI Energy estimated it would have to send 19,500 letters, Northern Natural estimated 45,000 letters, and National Fuel estimated 220,000 letters. 115 Based on a survey of nine jurisdictional companies, we estimate that approximately 7,605 auxiliary installation projects occur each year. VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 ensure that landowners receive adequate advance notice of activities on their property that could adversely affect them. 79. Further, while Golden Triangle indicates that compliance with the landowner notification requirements may require companies to create a database or purchase specialty software, we do not believe it is unreasonable or burdensome if the new notice requirements necessitate that some companies update their databases. All gas companies (regardless of size) need to know, both to enhance, replace, and maintain their facilities and to be able to respond to emergencies, precisely where their rights-of-way lie, how to get to their facilities, and how to contact the owners of the properties their facilities sit upon.116 The new notice requirements require companies to do little more than access this existing information and update it as needed.117 Preparation of a notice using information a company already needs to have on hand should not be burdensome or delay the commencement or progress of activities under section 2.55 or section 380.15. III. Information Collection Statement 80. The Paperwork Reduction Act (PRA) 118 requires each federal agency to seek and obtain Office of Management and Budget (OMB) approval before 116 Companies should already have such information on file, given that gas facilities generally were constructed under case-specific certificates obtained in proceedings in which the companies were required to give affected landowners notice in accordance with section 157.6(d), or were constructed under the blanket certificate regulations which require in section 157.203(d) that companies give landowners notice of all projects subject to those regulations’ prior notice provisions. In addition, companies need to periodically update such information to be able to comply with the PHMSA biennial reporting requirement. Further, since some of the major maintenance projects included in the PHMSA report will also qualify for prior notice under our new regulations, companies should be able to use the same project description to satisfy both PHMSA and Commission requirements. 117 Golden Triangle argues that it does not have a database of its easement holders. Golden Triangle’s Comments at pp. 7–8. We expect gas companies to have documented the metes and bounds, terms of, and parties to all existing easements. While we recognize that this is not a static data set, we expect companies to conduct systematic reviews to keep this information current. We note Golden Triangle acknowledges, as discussed above, that its personnel need to enter its rights-of-way for periodic routine activities including pipe-to-soil readings, leak patrols, surveillance patrols, meter station inspections, and walking the pipeline right-of-way. Golden Triangle’s Comments at pp. 9–10. If Golden Triangle does not have a database that identifies the precise location of and owners of the properties on which it has its rights-of-way, it should. 118 44 U.S.C. 3501–3520 (2012). PO 00000 Frm 00019 Fmt 4700 Sfmt 4700 72809 undertaking a collection of information directed to ten or more persons or contained in a rule of general applicability.119 The OMB’s regulations implementing the PRA require approval of certain information collection requirements imposed by agency rules.120 Upon approval of a collection of information, OMB will assign an OMB control number and an expiration date. Respondents subject to the filing requirements of an agency rule will not be penalized for failing to respond to the collection of information unless the collection of information displays a valid OMB control number. 81. The Commission is submitting the revised reporting requirements to OMB for its review and approval. The only entities affected by this rule would be natural gas companies under the Commission’s jurisdiction. The information collection requirements in this Final Rule are identified as follows. 82. FERC–577, ‘‘Gas Pipeline Certificates: Environmental Impact Statements,’’ identifies the Commission’s information collections relating to the requirements set forth in NEPA and Parts 2, 157, 284, and 380 of the Commission’s regulations. Applicants have to conduct appropriate studies which are necessary to determine the impact of the construction and operation of proposed jurisdictional facilities on human and natural resources, and the measures which may be necessary to protect the values of the affected area. These information collection requirements are mandatory. 83. Because this Final Rule adds a landowner notification requirement for certain activities undertaken pursuant to sections 2.55, 157, and 380.15 of our regulations, the overall burden on the industry will increase. However, because natural gas companies subject to our jurisdiction must already notify landowners in conjunction with NGA sections 3 projects and 7 case-specific applications and when conducting activities under Part 157 of our regulations, no new technology will be needed and no start-up costs will be incurred. Further, even without the new notification requirement, it is standard practice for some companies to inform landowners prior to coming onto their property, both as a courtesy and to avoid potential conflicts in landowner and company activities. Thus, the notification is expected to be consistent 119 OMB’s regulations at 5 CFR 1320.3(c)(4)(i) (2013) require that ‘‘[a]ny recordkeeping, reporting, or disclosure requirement contained in a rule of general applicability is deemed to involve ten or more persons.’’ 120 5 CFR 1320 (2013). E:\FR\FM\04DER1.SGM 04DER1 72810 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations with current industry practices for some companies, and consequently to impose little additional burden on those companies. 84. We are making some minor modifications to the numbers used to derive our estimate. Because, as revised by this Final Rule, the prior notice requirement will only apply to those activities that require ground disturbance (and not to all section 2.55 and section 380.15 activities, as was proposed in the NOPR) and will only require notice to landowners whose property will be crossed or used (and not to abutting landowners and landowners with a residence within 50 feet of the proposed work area, as the NOPR would have required), we believe the revised estimated burden can no longer be characterized as underestimated. The vast majority of activities that commentors identified (principally maintenance, such as mowing, noxious weed control, and equipment inspection and lubrication) will not be subject to our revised notification requirements. As a result, we are decreasing our estimate of the burden to notify landowners for maintenance activities, as described above in section 6: Burden Resulting from Notification Requirement.121 In the NOPR, Commission staff requested a small representative sample of nine regulated natural gas companies to estimate the number of section 2.55(a) activities conducted each year. One company provided a response too late to be included in the NOPR estimate. Factoring in this company’s data results in only a trivial change to the burden estimate in this Final Rule. 85. We are also including the burden associated with the change to section 157.203(d)(3) which was not included Annual number of respondents (A) Regulation section for new landowner notification requirements CFR CFR CFR CFR Annual number of filings per respondent 122 (B) Number of hours per filing (C) Total annual hours (A) × (B) × (C) 2.55(a) ........................................................................ 2.55(b) ........................................................................ 157.203(d)(3) ............................................................. 380.15 ........................................................................ 165 165 165 165 46 3 3 92 2 2 2 2 15,180 990 990 30,360 Total Annual Burden Hours .............................................. wreier-aviles on DSK5TPTVN1PROD with RULES 18 18 18 18 in the NOPR estimates. As discussed above, to ensure that the landowner notification requirements in sections 2.55(b) and 157.203(d)(3)(i) are equivalent, we are revising section 157.203(d)(3)(i) to require notice for ground disturbing replacement projects that would have qualified under section 2.55 but for the fact that replacement facilities are not of the same capacity and because of that fact are installed under the blanket certificate provisions. As a conservative estimate of the number of such capacity altering replacement projects, we assume that the same number of replacements take place under the Part 157, Subpart F, blanket regulations as under section 2.55(b). This is reflected in the table below. We estimate the additional paperwork burden that this Final Rule would impose in the table below. .............................. .............................. .............................. 47,520 86. Given that some companies currently voluntarily comply with the new notification requirements, we believe that the actual industry-wide increase in burden is likely to be less than what we have estimated here. Information Collection Costs: The Commission projects the average cost for all respondents to be as follows: 123 • $2,898,720 per year for all regulated entities; • $17,568 per year for each regulated entity. Title: FERC–577. Action: Revision. OMB Control Nos.: 1902–0128. Respondents: Natural gas pipeline companies. Frequency of Responses: On occasion. Necessity of Information: The requirement to notify landowners is necessary for the Commission to carry out its NGA responsibilities and meet the Commission’s objectives of addressing landowner concerns fairly. 121 Supra PP 73–79. column reflects a rounded estimate for each jurisdictional natural gas company, averaged over all of the existing 165 such companies. 123 The cost figures are derived by multiplying the total hours to prepare a response by an hourly wage 122 This VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 (Attention: Information Clearance Officer, Office of the Executive Director), by phone 202–502–8663, or by email to DataClearance@ferc.gov. Comments on the requirements may also be sent to the Office of Information and Regulatory Affairs, Office of Management and Budget, Washington, DC 20503 [Attention: Desk Officer for the Federal Energy Regulatory Commission]. For security reasons, comments should be sent by email to OMB at oira_submission@omb.eop.gov. Please reference OMB Control No. 1902–0128, FERC–577, and Docket No. RM12–11 in your submission. The information provided to landowners is intended to accommodate, to the extent possible, any concerns they may have regarding a natural gas company’s planning, locating, clearing, right-of-way maintenance, and facility construction or replacement activities on their property. Internal Review: The Commission has reviewed the revisions and has determined that they are necessary. These requirements conform to the Commission’s need for efficient information collection, communication, and management within the energy industry. The Commission has assured itself, by means of internal review, that there is specific, objective support for the burden estimates associated with the information collection requirements. 87. Interested persons may obtain information on the reporting requirements by contacting the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426 IV. Environmental Analysis 88. The Commission is required to prepare an Environmental Assessment or an Environmental Impact Statement for any action that may have a significant adverse effect on the human environment.124 The Commission has categorically excluded certain actions from these requirements as not having a estimate of $61 (based on average civil engineer wages and benefit information obtained from the Bureau of Labor Statistics’ data at http://bls.gov/ oes/current/naics4_221200.htm#17-0000 and http:// www.bls.gov/news.release/ecec.nr0.htm). 124 Regulations Implementing the National Environmental Policy Act of 1969, Order No. 486, 52 FR 47897 (December 17, 1987), FERC Stats. & Regs., Regulations Preambles 1986–1990 ¶ 30,783 (1987). PO 00000 Frm 00020 Fmt 4700 Sfmt 4700 E:\FR\FM\04DER1.SGM 04DER1 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations significant effect on the human environment.125 Generally, the actions proposed to be taken here fall within the categorical exclusions in the Commission’s regulations that are clarifying, corrective, or procedural and for information gathering, analysis, and dissemination.126 Accordingly, an environmental review is not necessary and has not been prepared in connection with this rulemaking . wreier-aviles on DSK5TPTVN1PROD with RULES V. Regulatory Flexibility Act 89. The Regulatory Flexibility Act of 1980 (RFA) 127 generally requires a description and analysis of agency rules that will have a significant economic impact on a substantial number of small entities. The RFA mandates consideration of regulatory alternatives that accomplish the stated objectives of a proposed rule and that minimize any significant economic impact on a substantial number of small entities. The SBA Office of Size Standards develops the numerical definition of a small business.128 The SBA has established a size standard for natural gas pipeline companies transporting natural gas, stating that a firm is small if its annual receipts are less than $25.5 million.129 90. Golden Triangle disagrees with the Commission’s statement that the proposed rule would not have a significant economic impact on a substantial number of small entities. We respond to Golden Triangle in Section B.5 above. We modify the small business impact below based on the revised estimates used in the information collection section above. 91. The new regulations impose requirements only on natural gas companies subject to the Commission’s jurisdiction, the majority of which are not small businesses. Most companies regulated by the Commission do not fall within the RFA’s definition of a small entity. Approximately 165 companies— nearly all of them large entities—would be potential respondents subject to data collection FERC–577 reporting requirements. For the year 2011 (the most recent year for which information is available), only 15 companies not affiliated with larger companies had annual revenues of less than $25.5 million. Moreover, the reporting 125 18 CFR 380.4 (2013). CFR 380.4(a)(1) and (5) (2013). 127 5 U.S.C. 601–612 (2012). 128 13 CFR 121.101 (2013). 129 13 CFR 121.201, Subsector 486 (2013); see SBA’s Table of Small Business Size Standards, effective March 26, 2012, available at: http:// www.sba.gov/sites/default/files/files/ Size_Standards_Table.pdf. 126 18 VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 requirements should have no meaningful economic impact on companies—be they large or small— subject to the Commission’s regulatory jurisdiction. The Commission estimates that the revised cost per small entity is $17,568 per year. The Commission does not consider the estimated impact per entity to be significant. Accordingly, pursuant to section 605(b) of the RFA, the Commission certifies that this Final Rule should not have a significant economic impact on a substantial number of small entities. VI. Document Availability 92. In addition to publishing the full text of this document in the Federal Register, the Commission provides all interested persons an opportunity to view and/or print the contents of this document via the Internet through FERC’s Home Page (http:// www.ferc.gov) and in FERC’s Public Reference Room during normal business hours (8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street NE., Room 2A, Washington DC 20426. 93. From FERC’s Home Page on the Internet, this information is available on eLibrary. The full text of this document is available on eLibrary in PDF and Microsoft Word format for viewing, printing, and/or downloading. To access this document in eLibrary, type the docket number excluding the last three digits of this document in the docket number field. 94. User assistance is available for eLibrary and the FERC’s Web site during normal business hours from FERC Online Support at 202–502–6652 (toll free at 1–866–208–3676) or email at ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502– 8371, TTY (202) 502–8659. Email the Public Reference Room at public.referenceroom@ferc.gov. VII. Effective Date and Congressional Notification 95. These regulations are effective February 3, 2014. The Commission has determined, with the concurrence of the Administrator of the Office of Information and Regulatory Affairs of OMB, that this rule is not a ‘‘major rule’’ as defined in section 351 of the Small Business Regulatory Enforcement Fairness Act of 1996. This rule is being submitted to the Senate, House, Government Accountability Office, and the Small Business Administration. List of Subjects 18 CFR Part 2 Administrative practice and procedure, and Reporting and recordkeeping requirements. PO 00000 Frm 00021 Fmt 4700 Sfmt 4700 72811 187 CFR Part 157 Administrative practice and procedure, Natural gas, and Reporting and recordkeeping requirements. 18 CFR Part 380 Environmental impact statements, and Reporting and recordkeeping requirements. By the Commission. Kimberly D. Bose, Secretary. In consideration of the foregoing, the Commission amends Parts 2, 157, and 380, Chapter I, Title 18, Code of Federal Regulations, as follows: PART 2—GENERAL POLICY AND INTERPRETATIONS 1. The authority citation for Part 2 continues to read as follows: ■ Authority: 5 U.S.C. 601; 15 U.S.C. 717– 717z, 3301–3432; 16 U.S.C. 792–828c, 2601– 2645, 42 U.S.C. 4321–4370h, 7101–7352. 2. Amend § 2.55 by: a. Adding a sentence to the end of paragraph (a)(1); ■ b. Revising paragraph (b)(1)(ii); and ■ c. Adding paragraph (c). The revision and additions read as follows: ■ ■ § 2.55 7(c). Definition of terms used in section * * * * * (a) * * * (1) * * * The auxiliary installations must be located within the existing or proposed certificated permanent rightof-way or authorized facility site and must be constructed using the temporary work space used to construct the existing or proposed facility (see Appendix A to this Part 2 for guidelines on what is considered to be the appropriate work area in this context). * * * * * (b) * * * (1) * * * (ii) The replacement facilities will have a substantially equivalent designed delivery capacity, will be located in the same right-of-way or on the same site as the facilities being replaced, and will be constructed using the temporary work space used to construct the existing facility (see Appendix A to Part 2 for guidelines on what is considered to be the appropriate work area in this context); * * * * * (c) Landowner notification. (1) No activity described in paragraphs (a) and (b) of this section that involves ground disturbance is authorized unless a company makes a good faith effort to notify in writing each affected E:\FR\FM\04DER1.SGM 04DER1 72812 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations landowner, as noted in the most recent county/city tax records as receiving the tax notice, whose property will be crossed or used as a result of the proposed activity, at least five days prior to commencing any activity under this section. For an activity required to respond to an emergency, the five-day prior notice period does not apply. The notification shall include at least: (i) A brief description of the facilities to be constructed or replaced and the effect the activity may have on the landowner’s property; (ii) The name and phone number of a company representative who is knowledgeable about the project; and (iii) A description of the Commission’s Dispute Resolution Division Helpline, which an affected person may contact to seek an informal resolution of a dispute as explained in section 1b.21(g) of the Commission’s regulations (18 CFR 1b.21(g)) and the Dispute Resolution Division Helpline number. (2) ‘‘Affected landowners’’ include owners of property interests, as noted in the most recent county/city tax records as receiving tax notice, whose property is directly affected (i.e. crossed or used) by the proposed activity, including all rights-of-way, facility sites (including compressor stations, well sites, and all above-ground facilities), access roads, pipe and contractor yards, and temporary work space. ■ 3. Revise Appendix A to Part 2 to read as follows: wreier-aviles on DSK5TPTVN1PROD with RULES Appendix A to Part 2—Guidance for Determining the Acceptable Construction Area for Auxiliary and Replacement Facilities These guidelines shall be followed to determine what area may be used to construct the auxiliary or replacement facility. Specifically, they address what areas, in addition to the permanent right-of-way, may be used. An auxiliary or replacement facility must be within the existing right-of-way or facility site as specified by § 2.55(a)(1) or (b)(1)(ii). Construction activities for the auxiliary or replacement facility can extend outside the current permanent right-of-way if they are within the temporary and permanent right-ofway and associated work spaces used in the original installation. If documentation is not available on the location and width of the temporary and permanent rights-of-way and associated work spaces that were used to construct the original facility, the company may use the following guidance for the auxiliary installation or replacement, provided the appropriate easements have been obtained: a. Construction should be limited to no more than a 75-foot-wide right-of-way including the existing permanent right-ofway for large diameter pipeline (pipe greater VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 than 12 inches in diameter) to carry out routine construction. Pipeline 12 inches in diameter and smaller should use no more than a 50-foot-wide right-of-way. b. The temporary right-of-way (working side) should be on the same side that was used in constructing the original pipeline. c. A reasonable amount of additional temporary work space on both sides of roads and interstate highways, railroads, and significant stream crossings and in side-slope areas is allowed. The size should be dependent upon site-specific conditions. Typical work spaces are: Typical extra area (width/length) Item Two lane road (bored). Four lane road (bored). Major river (wet cut) .. Intermediate stream (wet cut). Single railroad track .. 25–50 by 100 feet. 50 by 100 feet. 100 by 200 feet. 50 by 100 feet. 25–50 by 100 feet. d. The auxiliary or replacement facility must be located within the permanent rightof-way or, in the case of nonlinear facilities, the cleared building site. In the case of pipelines this is assumed to be 50 feet wide and centered over the pipeline unless otherwise legally specified. However, use of the above guidelines for work space size is constrained by the physical evidence in the area. Areas obviously not cleared during the original construction, as evidenced by stands of mature trees, structures, or other features that exceed the age of the facility being replaced, should not be used for construction of the auxiliary or replacement facility. If these guidelines cannot be met, the company should consult with the Commission’s staff to determine if the exemption afforded by § 2.55 may be used. If the exemption may not be used, construction authorization must be obtained pursuant to another regulation under the Natural Gas Act. PART 157—APPLICATIONS FOR CERTIFICATES OF PUBLIC CONVENIENCE AND NECESSITY AND FOR ORDERS PREMITTING AND APPROVING ABANDONMENT UNDER SECTION 7 OF THE NATURAL GAS ACT 4. The authority citation for Part 157 continues to read as follows: ■ Authority: 15 U.S.C. 717–717z. 5. Amend § 157.202 by revising paragraph (b)(2)(i) to read as follows: ■ § 157.202 Definitions. * * * * * (b) * * * (2)(i) Eligible facility means, except as provided in paragraph (b)(2)(ii) of this section, any facility subject to the Natural Gas Act jurisdiction of the Commission that is necessary to provide service within existing certificated PO 00000 Frm 00022 Fmt 4700 Sfmt 4700 levels. Eligible facility also includes any gas supply facility or any facility, including receipt points, needed by the certificate holder to receive gas into its system for further transport or storage, and interconnecting facilities between transporters that transport natural gas under part 284 of this chapter. Further, eligible facility includes main line, lateral, and compressor replacements that do not qualify under § 2.55(b) of this chapter because they will result in an incidental increase in the capacity of main line facilities, or because they will not satisfy the location or work space requirements of § 2.55(b). Replacements must be done for sound engineering purposes. Replacements for the primary purpose of creating additional main line capacity are not eligible facilities; however, replacements and the modification of facilities to rearrange gas flows or increase compression for the primary purpose of restoring service in an emergency due to sudden unforeseen damage to main line facilities are eligible facilities. Eligible facility also includes auxiliary installations and observation wells which do not qualify under § 2.55(a) of this chapter because they will not satisfy the location or work space requirements of § 2.55(a). * * * * * ■ 6. Amend § 157.203 by revising paragraph (d)(3)(i) to read as follows: § 157.203 Blanket certification. * * * * * (d) * * * (3) * * * (i) No landowner notice is required for replacements which would have been done under § 2.55 of this chapter but for the fact that the replacement facilities are not of the same capacity as long as they meet the location requirements of § 2.55(b)(1)(ii) of this chapter and do not cause any ground disturbance; or any replacement done for safety, DOT compliance, environmental, or unplanned maintenance reasons that are not foreseen and that require immediate attention by the certificate holder. * * * * * PART 380—REGULATIONS IMPLEMENTING THE NATIONAL ENVIRONMENTAL POLICY ACT 7. The authority citation for Part 380 continues to read as follows: ■ Authority: 42 U.S.C. 4321–4370h, 7101– 7352; E.O. 12009, 3 CFR 1978 Comp., p. 142. 8. In § 380.15, redesignate paragraphs (c), (d), (e), and (f) as paragraphs (d), (e), ■ E:\FR\FM\04DER1.SGM 04DER1 Federal Register / Vol. 78, No. 233 / Wednesday, December 4, 2013 / Rules and Regulations (f), and (g) and add new paragraph (c) to read as follows: § 380.15 Siting and maintenance requirements. * * * * * (c) Landowner notification. (1) No maintenance activity that involves ground disturbance is authorized unless a company makes a good faith effort to notify in writing each affected landowner, as noted in the most recent county/city tax records as receiving the tax notice, whose property will be crossed or used as a result of the proposed activity, at least five days prior to commencing any activity under this section. For an activity required to respond to an emergency, the five-day prior notice period does not apply. The notification shall include at least: (i) A brief description of the activity and the effect the activity may have on the landowner’s property; (ii) The name and phone number of a company representative who is knowledgeable about the project; and (iii) A description of the Commission’s Dispute Resolution Division Helpline, which an affected person may contact to seek an informal resolution of a dispute as explained in section 1b.21(g) of the Commission’s regulations (18 CFR 1b.21(g)) and the Dispute Resolution Division Helpline number. (2) ‘‘Affected landowners’’ include owners of property interests, as noted in the most recent county/city tax records as receiving tax notice, whose property is directly affected (i.e. crossed or used) by the proposed activity, including all rights-of-way, facility sites (including compressor stations, well sites, and all above-ground facilities), access roads, pipe and contractor yards, and temporary work space. * * * * * [FR Doc. 2013–28548 Filed 12–3–13; 8:45 am] BILLING CODE 6717–01–P DEPARTMENT OF THE TREASURY Financial Crimes Enforcement Network 31 CFR Part 1010 wreier-aviles on DSK5TPTVN1PROD with RULES RIN 1506–AB20 Definitions of Transmittal of Funds and Funds Transfer Financial Crimes Enforcement Network (‘‘FinCEN’’), Department of the Treasury; Board of Governors of the Federal Reserve System (‘‘Board’’). ACTION: Final rule. AGENCY: VerDate Mar<15>2010 13:12 Dec 03, 2013 Jkt 232001 The Financial Crimes Enforcement Network, a bureau of the Department of the Treasury, and the Board of Governors of the Federal Reserve System are issuing this Final Rule amending the regulatory definitions of ‘‘funds transfer’’ and ‘‘transmittal of funds’’ under the regulations implementing the Bank Secrecy Act (‘‘BSA’’). We are amending the definitions to maintain their current scope in light of changes to the Electronic Fund Transfer Act, which will avoid certain currently covered transactions being excluded from BSA requirements. DATES: Effective Date: This rule is effective January 3, 2014. FOR FURTHER INFORMATION CONTACT: FinCEN: The FinCEN Resource Center at (800) 949–2732. Board: Koko Ives, Manager, BSA/AML Compliance Section, (202) 973–6163, Division of Banking Supervision and Regulation, or Clinton Chen, Attorney, (202) 452–3952, Legal Division. For the hearing impaired only, Telecommunication Device for the Deaf (TDD), (202) 263–4869. SUPPLEMENTARY INFORMATION: SUMMARY: I. Statutory Provisions The Currency and Foreign Transactions Reporting Act of 1970, as amended by the USA PATRIOT Act of 2001 and other legislation, which legislative framework is commonly referred to as the ‘‘BSA,’’ 1 authorizes the Secretary of the Treasury (‘‘Secretary’’) to require financial institutions to keep records and file reports that ‘‘have a high degree of usefulness in criminal, tax, or regulatory proceedings, or in the conduct of intelligence or counterintelligence activities, including analysis, to protect against international terrorism.’’ 2 The Secretary has delegated to the Director of FinCEN the authority to implement, administer, and enforce compliance with the BSA and associated regulations.3 The BSA was amended by the Annunzio-Wylie Anti-Money Laundering Act of 1992 (Pub. L. 102– 550) (‘‘Annunzio-Wylie’’). AnnunzioWylie authorizes the Secretary and the Board to issue joint regulations requiring insured banks to maintain records of domestic funds transfers.4 In 1 The BSA is codified at 12 U.S.C. 1829b and 1951–1959, 18 U.S.C. 1956, 1957, and 1960, and 31 U.S.C. 5311–5314 and 5316–5332 and notes thereto, with implementing regulations at 31 CFR Chapter X. See 31 CFR 1010.100(e). 2 31 U.S.C. 5311. 3 Treasury Order 180–01 (Sept. 26, 2002). 4 12 U.S.C. 1829b(b)(2) (2006). Treasury has independent authority to issue regulations requiring PO 00000 Frm 00023 Fmt 4700 Sfmt 4700 72813 addition, Annunzio-Wylie authorizes the Secretary and the Board to issue joint regulations requiring insured banks and certain nonbank financial institutions to maintain records of international funds transfers and transmittals of funds.5 Annunzio-Wylie requires the Secretary and the Board, in issuing regulations for international funds transfers and transmittals of funds, to consider the usefulness of the records in criminal, tax, or regulatory investigations or proceedings, and the effect of the regulations on the cost and efficiency of the payments system.6 The Electronic Fund Transfer Act (‘‘EFTA’’) 7 was enacted in 1978 to establish the rights and liabilities of consumers as well as the responsibilities of all participants in electronic fund transfer activities. The EFTA is implemented by Regulation E, which sets up the framework that establishes the rights, liabilities, and responsibilities of participants in electronic fund transfer systems.8 Section 1073 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (‘‘Dodd-Frank Act’’),9 added a new section 919 to the EFTA, creating a comprehensive new system of consumer protections for remittance transfers sent by consumers in the United States to individuals and businesses in foreign countries. Because the new section 919 of the EFTA defines ‘‘remittance transfers’’ broadly, most electronic transfers of funds sent by consumers in the United States to recipients in other countries will be subject to the new protections. II. Background Information A. Current Regulations Regarding Funds Transfers and Transmittals of Funds On January 3, 1995, FinCEN and the Board jointly issued a rule that requires banks and nonbank financial institutions to collect and retain information on certain funds transfers and transmittals of funds (‘‘recordkeeping rule’’).10 At the same nonbank financial institutions to maintain records of domestic transmittals of funds. 5 12 U.S.C.1829b(b)(3) (2006). 6 Id. As discussed later in this Federal Register notice, the final rule would have no effect on the current scope of or substantive requirements in BSA regulations and thus no effect on the cost or efficiency of the payment systems. 7 15 U.S.C. 1693 et seq. 8 12 CFR part 1005. 9 Public Law 111–203, 124 Stat. 1376, section 1073 (2010). 10 31 CFR 1020.410(a) (recordkeeping requirements for banks); 31 CFR 1010.410(e) (recordkeeping requirements for nonbank financial institutions). The Board revised its Regulation S (12 CFR part 219) to incorporate by reference the E:\FR\FM\04DER1.SGM Continued 04DER1

Agencies

[Federal Register Volume 78, Number 233 (Wednesday, December 4, 2013)]
[Rules and Regulations]
[Pages 72794-72813]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-28548]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Parts 2, 157, and 380

[Docket Nos. RM12-11-000 and RM12-11-001; Order No. 790]


Revisions to Auxiliary Installations, Replacement Facilities, and 
Siting and Maintenance Regulations

AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY:  The Federal Energy Regulatory Commission (Commission) is 
issuing this Final Rule to amend its regulations to clarify that 
auxiliary installations added to existing or proposed interstate 
transmission facilities under the Commission's regulations must be 
located within the authorized right-of-way or facility site for the 
existing or proposed facilities and use only the same temporary work 
space that was or will be used to construct the existing or proposed 
facilities; and to codify the common industry practice of notifying 
landowners prior to coming onto their property to install auxiliary or 
replacement facilities, certain replacements, or conduct maintenance 
activities.

DATES:  This rule is effective February 3, 2014.

FOR FURTHER INFORMATION CONTACT: 
Gordon Wagner, Office of the General Counsel, Federal Energy Regulatory 
Commission, 888 First Street NE., Washington, DC 20426 (202) 502-8947, 
gordon.wagner@ferc.gov.
Katherine Liberty, Office of the General Counsel, Federal Energy 
Regulatory Commission, 888 First Street NE., Washington, DC 20426 (202) 
502-6491, katherine.liberty@ferc.gov.
Douglas Sipe, Office of Energy Projects, Federal Energy Regulatory 
Commission, 888 First Street NE., Washington, DC 20426 (202) 502-8837, 
douglas.sipe@ferc.gov.
Howard Wheeler, Office of Energy Projects, Federal Energy Regulatory 
Commission, 888 First Street NE., Washington, DC 20426 (202) 502-8688, 
howard.wheeler@ferc.gov.

SUPPLEMENTARY INFORMATION: 

145 FERC ] 61,154

United States of America

Federal Energy Regulatory Commission

Revisions to Auxiliary Installations, Replacement Facilities, and 
Siting and Maintenance Regulations

Docket Nos. RM12-11-000; RM12-11-001

Order No. 790

Final Rule

                            Table of Contents
------------------------------------------------------------------------
                                                         Paragraph Nos.
------------------------------------------------------------------------
I. Background........................................                  2
    A. Request for Clarification of Section 2.55(a)                    8
     of the Commission's Regulations.................
    B. Notice of Proposed Rulemaking (NOPR)..........                  9
II. Discussion.......................................                 12
    A. Section 2.55(a) Auxiliary Facilities..........                 12
        1. Commission Jurisdiction...................                 13
        2. Section 2.55 Siting and Construction                       17
         Limitations.................................
        3. Environmental Issues......................                 40
        4. Compliance with Executive Orders..........                 43
        5. Section 2.55 Authorization and Part 157,                   45
         Subpart F, Blanket Authorization............
        6. ``Grandfathering'' Existing Section                        49
         2.55(a) Installations.......................
        7. Burden of Section 2.55's Right-of-Way                      51
         Requirement.................................
    B. Landowner Notification........................                 54
        1. Jurisdictional Basis and Need for                          58
         Landowner Notification......................

[[Page 72795]]

 
        2. Exceptions to Landowner Notification                       62
         Requirements................................
        3. Part 157 Landowner Notification Exemption                  64
         for Replacement Projects....................
        4. Requirement that Notification Inform                       65
         Landowners of the Availability of the
         Commission's Dispute Resolution Division....
        5. Landowner Notification for Maintenance                     68
         Activities..................................
        6. Burden Resulting from Notification                         73
         Requirement.................................
III. Information Collection Statement................                 80
IV. Environmental Analysis...........................                 88
V. Regulatory Flexibility Act........................                 89
VI. Document Availability............................                 92
VII. Effective Date and Congressional Notification...                 95
------------------------------------------------------------------------

145 FERC ] 61,154

United States of America

Federal Energy Regulatory Commission

Before Commissioners: Jon Wellinghoff, Chairman; Philip D. Moeller, 
John R. Norris, Cheryl A. LaFleur, and Tony Clark.

Revisions to Auxiliary Installations, Replacement Facilities, and 
Siting and Maintenance Regulations

Docket Nos. RM11-12-000; RM11-12-001

Order No. 790

Final Rule

(Issued November 22, 2013)

    1. The Federal Energy Regulatory Commission (Commission) is issuing 
this Final Rule to amend its regulations to (1) clarify that auxiliary 
installations added to existing or proposed interstate transmission 
facilities under section 2.55 of the regulations \1\ must be located 
within the authorized right-of-way or facility site for the existing or 
proposed facilities and use only the same temporary work space that was 
or will be used to construct the existing or proposed facilities; and 
(2) codify the common industry practice of notifying landowners prior 
to coming onto their property to install auxiliary or replacement 
facilities under section 2.55; certain replacements under Part 157, 
Subpart F; or conduct maintenance activities under section 380.15.
---------------------------------------------------------------------------

    \1\ 18 CFR 2.55 (2013).
---------------------------------------------------------------------------

I. Background

    2. Section 7(c)(1)(A) of the Natural Gas Act (NGA) requires a 
natural gas company to have certificate authorization for the 
``construction or extension of any facilities.'' \2\ To ``avoid the 
filing and consideration of unnecessary applications for 
certificates,'' \3\ i.e., to save the time and expense that would 
otherwise be expended by companies and the Commission in undertaking a 
full, formal NGA section 7 certificate proceeding for every 
modification to an authorized system, the Commission added section 2.55 
to its regulations.\4\ Section 2.55 establishes that for the purposes 
of section 7(c), ``the word facilities as used therein shall be 
interpreted to exclude'' auxiliary and replacement facilities.\5\ Thus, 
while an auxiliary or replacement facility that qualifies for purposes 
of section 2.55 remains subject to the Commission's NGA jurisdiction, 
it does not require an individual, facility-specific section 7(c) 
certificate authorization.
---------------------------------------------------------------------------

    \2\ 15 U.S.C. 717f(c)(1)(A) (2012).
    \3\ Filing of Applications for Certificates of Public 
Convenience and Necessity, Notice of Proposed Rulemaking, NOPR, 13 
FR 6253, at 6254 (October 23, 1948).
    \4\ Section 2.55 went into effect in 1949. The Commission 
subsequently considered expanding section 2.55, but stated that 
although it ``recognizes the desirability of dealing with minor 
installations on a practical basis,'' it would not rely on section 
2.55 because of ``doubts that the Natural Gas Act authorizes it to 
further expand its rule excluding certain facilities from the 
certification requirements''; instead the Commission ``recommended 
to the Congress that it be given such authority'' to ``permit[] 
greater flexibility in its procedures with respect to rate filings 
and certification of natural-gas facilities.'' Amending the 
Commission's General Rules and Regulations, Order No. 185, 15 FPC 
793, at p. 794 (1956). Such authority was not forthcoming. In an 
effort to forego issuing an individual certificate authorization in 
advance of every single jurisdictional action, the Commission 
provided for companies to file a single certificate application 
under section 157.6 that ``covered in general outline along the 
lines of a budget estimate the proposed routine construction 
intended to be undertaken by it during the current or ensuing fiscal 
year,'' describing the facilities, costs, capacity, purpose, 
construction schedule, customers affected, effects on gas supply, 
rates, service, etc. Id. The Commission added section 2.58 to its 
regulations for these ``budget-type'' certificate applications, see 
Gas Purchase Facilities--Budget-Type Certificate Applications, Order 
No. 247, 27 FPC 1119 (1962). These regulations were removed in 1982 
when the blanket certificate program was instituted, which offered 
companies a streamlined means to obtain certificate authorization 
for a limited set of routine and well understood facilities. 
Interstate Pipeline Certificates for Routine Transactions, Order No. 
234, 47 FR 24254 (June 4, 1982), FERC Stats. & Regs., Regulations 
Preambles 1982-1985 ] 30,368 (1982), order on reh'g, Order No. 234-
A, 47 FR 38871 (September 3, 1982), FERC Stats. & Regs., Regulations 
Preambles 1982-1985 ] 30,389 (1982), amended by, Sales and 
Transportation by Interstate Pipelines and Distributors; Expansion 
of Categories of Activities Authorized Under Blanket Certificate, 
Order No. 319, 48 FR 34875 (August 1, 1983), FERC Stats. & Regs., 
Regulations Preambles 1982-1985 ] 30,479 (1983). The scope of the 
blanket-eligible facilities has been expanded several times since 
1982. See, e.g., Revisions to the Blanket Certificate Regulations 
and Clarification Regarding Rates, Order No. 686, 71 FR 63680 
(October 31, 2006), FERC Stats. & Regs. ] 31,231 (2006), order on 
reh'g and clarification, Order No. 686-A, 72 FR 37431 (July 10, 
2007), FERC Stats. & Regs. ] 31,249 (2007), order on reh'g, Order 
No. 686-B, 72 FR 54818 (September 27, 2007), FERC Stats. & Regs. ] 
31,255 (2007).
    \5\ 18 CFR 2.55 (2013).
---------------------------------------------------------------------------

    3. Facilities that qualify under section 2.55(a) must be ``merely 
auxiliary or appurtenant to an authorized or proposed pipeline 
transmission system'' and installed ``only for the purpose of obtaining 
more efficient or more economical operation of the authorized or 
proposed transmission facilities,'' such as ``[v]alves; drips; pig 
launchers/receivers; yard and station piping; cathodic protection 
equipment; gas cleaning, cooling and dehydration equipment; residual 
refining equipment; water pumping, treatment and cooling equipment; 
electrical and communication equipment; and buildings.'' \6\
---------------------------------------------------------------------------

    \6\ Id. 2.55(a)(1). But for the inclusion of pig launchers/
receivers in 1999, this list has remained unaltered since section 
2.55 was put in place in 1949. Note that if a pipeline company wants 
to install any facilities specifically named in section 2.55(a)(1), 
but will not be installing them only for the purpose of obtaining 
more efficient or more economical operation of existing or proposed 
interstate transmission facilities, then the company cannot rely on 
section 2.55(a). See, e.g., Algonquin Gas Transmission Company 
(Algonquin), 57 FERC ] 61,052 (1991), in which the Commission found 
a company's reliance on section 2.55(a) to install an air 
stabilization unit was unwarranted because the unit was necessary 
for the company to meet the terms of its service agreements and 
comply with safety requirements, and thus was not only for the 
purpose of obtaining more efficient or more economical operation of 
its transmission facilities. See also West Texas Gas, Inc., 62 FERC 
] 61,039 (1993), in which the Commission found section 2.55(a) did 
not apply to facilities constructed to interconnect with another 
pipeline because the purpose of the interconnect was to enable the 
company to gain access to cheaper sources of gas, and thus was not 
only for the purpose of obtaining more efficient or more economical 
operation of its transmission facilities and Natural Gas Pipeline 
Company of America, 114 FERC ] 61,061, at n.4 (2006), in which the 
Commission rejected a company's effort to employ section 2.55(a) to 
undertake well recompletions in a storage reservoir, ``because the 
construction is designed to provide incremental storage capacity 
rather than to maintain the current level of service for existing 
customers,'' and consequently required the company to obtain case-
specific authorization for the recompletions (the company was 
permitted to rely on section 2.55(a) to make other modifications to 
its storage facility, including adding station piping, header and 
isolation valves with blowdowns, control valves, gas coolers, a 
transformer, field inlet separation facilities, and pigging 
equipment).

---------------------------------------------------------------------------

[[Page 72796]]

    4. Originally, natural gas companies were not required to notify 
the Commission in advance of construction under section 2.55(a). 
However, in 1999 the Commission determined that when companies plan to 
add auxiliary facilities to a project that has already been authorized, 
but not yet completed, or to a project for which authorization is still 
pending, prior notification to the Commission is needed in order to 
afford the Commission the opportunity to assess the auxiliary 
facilities' environmental impacts, impacts which, when combined with 
the impacts of the construction and operation of the facilities that 
will be augmented by the auxiliary facilities, could potentially alter 
the Commission's conclusions regarding the overall environmental impact 
of the project.
    5. As a result, Order No. 603 \7\ revised section 2.55(a)(2) to 
require that if a company plans to rely on section 2.55 to construct 
auxiliary facilities in conjunction with: (1) A project for which case-
specific certificate authority has already been received but which is 
not yet in service, (2) a proposed project for which a case-specific 
certificate application is pending, or (3) facilities that will be 
constructed subject to the prior notice provisions of the Part 157, 
Subpart F blanket certificate regulations, then the company must 
provide a description of the auxiliary facilities and their location to 
the Commission at least 30 days in advance of their installation.\8\ In 
the case of auxiliary facilities that will be constructed in 
conjunction with a project for which an application under Part 157, 
Subpart A for case-specific certificate authority is pending, the 
auxiliary facilities must be described in the application's 
environmental report, as required by section 380.12 of the Commission's 
regulations, or in a supplemental filing while the application is 
pending.\9\ The Commission explained these advance notification 
requirements are necessary in order to afford the Commission time to 
include the environmental impacts of the auxiliary facilities as part 
of its environmental review of the project.\10\
---------------------------------------------------------------------------

    \7\ Revisions of Existing Regulations Under Part 157 and Related 
Sections of the Commission's Regulations Under Natural Gas Act, 
Order No. 603, 64 FR 26572, at 26574 (May 14, 1999), FERC Stats. & 
Regs., Regulations Preambles July 1996-December 2000 ] 31,073 
(1999), order on reh'g, Order No. 603-A, 64 FR 54522 (October 7, 
1999), FERC Stats. & Regs., Regulations Preambles July 1996-December 
2000 ] 31,081 (1999), order on reh'g, Order No. 603-B, 65 FR 11,462 
(March 3, 2000), FERC Stats. & Regs., Regulations Preambles July 
1996-December 2000 ] 31,094 (2000).
    \8\ See 18 CFR 2.55(a)(2)(ii) (2013).
    \9\ See 18 CFR 2.55(a)(2)(iii) (2013). In the case of auxiliary 
facilities to be constructed in conjunction with a proposed project 
for which an application for case-specific certificate authority is 
pending, section 2.55(a)(2)(iii) requires that the applicant 
describe the auxiliary facilities in the application's section 
380.12 Resource Report 1--General Project Description. Section 
380.12(c)(1) requires the applicant to describe and provide location 
maps for ``all jurisdictional facilities, including all aboveground 
facilities associated with the project (such as: meter stations, pig 
launchers/receivers, valves), to be constructed, modified, 
abandoned, replaced, or removed, including related construction and 
operational support activities and areas such as maintenance bases, 
staging areas, communications towers, power line, and new access 
roads (roads to be built or modified).'' Section 380.12(c)(2) 
requires that the applicant's Resource Report 1 identify and 
describe ``all nonjurisdictional facilities, including auxiliary 
facilities, that will be built in association with the project, 
including facilities to be built by other companies.'' If a company 
with a pending application for case-specific certificate authority 
determines that it will also need to construct auxiliary facilities, 
section 2.55(a)(2)(iii) requires that the applicant make a 
supplemental filing describing the auxiliary facilities while the 
application is pending.
    \10\ Revisions to Regulations Governing NGPA Section 311 
Construction and the Replacement of Facilities, Order No. 544, 57 FR 
46,487 (October 9, 1992), FERC Stats. & Regs., Regulations Preambles 
January 1991-June 1996 ] 30,951 (1992), order on reh'g, Order No. 
544-A, 58 FR 57730 (October 27, 1993), FERC Stats. & Regs., 
Regulations Preambles January 1991-June 1996 ] 30,983 (1993).
---------------------------------------------------------------------------

    6. Section 2.55(b) permits companies to replace facilities that are 
or will soon be physically deteriorated or obsolete, so long as doing 
so will not result in a reduction or abandonment of service and the 
replacement facilities will have a substantially equivalent designed 
delivery capacity.\11\ Section 2.55(b) replacement projects can go 
forward without case-specific or blanket certificate authorization. 
Further, the 30-day prior notice requirement in section 2.55(b)(2) for 
more expensive replacement projects only requires notice to the 
Commission, not landowners.\12\
---------------------------------------------------------------------------

    \11\ 18 CFR 2.55(b) (2013).
    \12\ The requirement that a company give at least 30 days prior 
notice to the Commission before commencing a replacement project 
applies if the project will exceed the current cost limit for 
projects automatically authorized under the Part 157 blanket 
certificate regulations. However, unlike the blanket certificate 
regulations, section 2.55 places no cost limits on auxiliary 
installations or replacement projects that qualify under that 
section.
---------------------------------------------------------------------------

    7. In Order No. 603 the Commission specified that all replacement 
facilities must be constructed within the previously authorized right-
of-way or facility site for the existing facilities and use the same 
temporary work spaces used for construction of the existing 
facilities.\13\ The Commission reasoned that section 2.55(b) 
replacements ``should only involve basic maintenance or repair to 
relatively minor facilities,'' where it has been determined that no 
significant impact to the environment would occur.\14\ The Commission 
suggested that in situations where a company wants to use land outside 
previously authorized areas, it may be able to rely on its blanket 
certificate authority rather than 2.55(b) to undertake the project.\15\
---------------------------------------------------------------------------

    \13\ Order No. 603, 64 FR 26572 at 26574-76, FERC Stats. & Regs. 
] 31,073 and 18 CFR 2.55(b) (2013).
    \14\ Order No. 603-A, 64 FR 54522 at 54524, FERC Stats. & Regs. 
] 31,081.
    \15\ Order No. 603, 64 FR 26572 at 26580, FERC Stats. & Regs. ] 
31,073.
---------------------------------------------------------------------------

A. Request for Clarification of Section 2.55(a) of the Commission's 
Regulations

    8. On April 2, 2012, the Interstate Natural Gas Association of 
America (INGAA) requested clarification regarding the installation of 
auxiliary facilities under section 2.55(a) of the Commission's 
regulations.\16\ INGAA maintained that Commission staff had stated in 
discussions with pipeline representatives and in industry meetings that 
companies undertaking section 2.55(a) auxiliary installations to 
augment existing facilities that are already in service must stay 
within the right-of-way or facility site for the existing facilities 
and restrict construction activities to previously used work spaces. 
INGAA disagreed with these constraints, arguing that section 2.55(a) 
activities had not been limited in this way in the past, and that 
Commission staff's position amounted to rulemaking without the 
opportunity for notice and comment, contrary to the requirements of the 
Administrative Procedure Act (APA).\17\ Pursuant to section 
385.207(a)(4) of the Commission's Rules of Practice and Procedure, 
INGAA requested that the Commission confirm INGAA's view that the 
right-of-way and work space constraints stated by staff do not apply to 
section 2.55(a) auxiliary installations.
---------------------------------------------------------------------------

    \16\ On May 2, 2012, MidAmerican Energy Pipeline Group (which 
includes Kern River Gas Transmission Company and Northern Natural 
Gas Company) filed a motion to intervene and comments in support of 
INGAA's petition.
    \17\ 5 U.S.C. 553 (2012).

---------------------------------------------------------------------------

[[Page 72797]]

B. Notice of Proposed Rulemaking (NOPR)

    9. On December 20, 2012, the Commission issued a NOPR proposing to 
revise its regulations to clarify that, as with replacement projects 
under section 2.55(b), all auxiliary installation projects must take 
place within a company's authorized right-of-way or facility site and 
use only previously approved work spaces. In addition, the NOPR 
proposed to add a 10-day landowner notification requirement for section 
2.55 auxiliary and replacement facilities and for section 380.15 
maintenance activities.\18\ Timely comments on the NOPR were submitted 
by INGAA; \19\ Golden Triangle Storage, Inc. (Golden Triangle); 
MidAmerican Energy Pipeline Group (MidAmerican Energy); Southern Star 
Central Gas Pipeline, Inc. (Southern Star); National Fuel Supply 
Corporation and Empire Pipeline, Inc. (National Fuel); and WBI Energy 
Transmission, Inc. (WBI Energy). Golden Triangle, MidAmerican Energy, 
Southern Star, and WBI Energy support INGAA's comments.
---------------------------------------------------------------------------

    \18\ Revisions to Auxiliary Installations, Replacement 
Facilities, and Siting and Maintenance Regulations, NOPR, 78 FR 679, 
683 (January 4, 2013), FERC Stats. & Regs. ] 32,696 (2012) (cross-
referenced at 141 FERC ] 61,228 (2012)). While section 380.15 covers 
siting, construction, and maintenance, our existing regulations 
already have notification requirements in place applicable to siting 
and construction; consequently, the additional prior notice 
requirement described in the new section 380.15(c) will apply 
exclusively to maintenance activities.
    \19\ On January 22, 2013, INGAA made a filing styled as a 
request for rehearing of the NOPR, and on March 5, 2013, it filed 
comments on the NOPR. INGAA argues the NOPR functioned as a Final 
Rule by giving immediate effect to a change in the regulations 
without providing affected entities notice and an opportunity to 
comment. We do not believe the NOPR's clarification concerning 
section 2.55(a) effected any change; rather, it articulated 
existing, long-standing constraints and obligations with respect to 
auxiliary installations. Because the NOPR does not constitute an 
instant Final Rule, we find no cause to consider requests for 
rehearing of the NOPR. Nevertheless, we will accept INGAA's request 
for rehearing and treat it as comments in response to the NOPR. 
Thus, regardless of the distinction between INGAA's and the 
Commission's characterization of the NOPR, the concerns INGAA raises 
in both of its submissions will be addressed herein. We will 
identify INGAA's self-styled request for rehearing as January 2013 
Comments and its subsequent submission as March 2013 Comments.
---------------------------------------------------------------------------

    10. The commentors object to the Commission's position that 
auxiliary installations to enhance existing facilities must be located 
within the previously authorized areas for the existing facilities, 
arguing the Commission has not heretofore imposed such a limitation on 
the siting or construction of auxiliary facilities.
    11. The commentors also oppose the NOPR's proposed new requirement 
that companies give prior notice to affected landowners before 
commencing construction of auxiliary or replacement facilities under 
section 2.55 of the regulations or maintenance activities under section 
380.15 of the regulations. Although the commentors do not dispute the 
Commission's position in the NOPR that it is appropriate to give 
landowners prior notice to the extent practicable in order to minimize 
inconvenience to landowners, the commentors contend the proposed notice 
procedures described in the NOPR (1) are unnecessary, noting that some 
companies already comply with the spirit of this stipulation, and (2) 
are impractical, particularly with respect to urgent or unanticipated 
maintenance activities.

II. Discussion

A. Section 2.55(a) Auxiliary Facilities

    12. In this Final Rule, the Commission revises its regulations, as 
proposed in the NOPR, to clarify that all section 2.55(a) auxiliary 
installations added to existing or proposed interstate transmission 
facilities must be located within the authorized right-of-way or 
facility site for the existing or proposed facilities and use only the 
same temporary work space that was or will be used to construct the 
existing or proposed facilities.
1. Commission Jurisdiction
    13. INGAA argues that section 2.55(a) can be distinguished from 
section 2.55(b) on the grounds that auxiliary facilities are not needed 
to provide certificated services, and therefore are not jurisdictional, 
while replacement facilities are essential to provide certificated 
services, and therefore are jurisdictional. We disagree. Although 
section 2.55 states that ``for purposes of section 7(c) of the Natural 
Gas Act, as amended, the word facilities as used therein shall be 
interpreted to exclude'' auxiliary and replacement facilities,\20\ the 
Commission's choice of wording in drafting this section cannot change 
the fact that section 2.55(a) auxiliary facilities and section 2.55(b) 
replacement facilities nevertheless are jurisdictional facilities for 
purposes of section 7 of the NGA. It went without saying in 1949, and 
has largely gone without saying since, that all section 2.55 facilities 
are subject to the Commission's jurisdiction. This is obvious with 
respect to replacements, since the new facilities step into the shoes 
of the aging facilities they replicate, and so assume the replaced 
facilities' jurisdictional status. Section 2.55(a) auxiliary 
installations are also jurisdictional, comprising that category of 
facilities that enable companies to operate existing or proposed 
jurisdictional facilities more efficiently or economically. All section 
2.55 facilities are integrated into a larger interstate transmission 
system and serve no function other than to enable that system to 
perform its jurisdictional functions more efficiently or economically; 
just as the larger system is jurisdictional, the component parts of 
that system, including auxiliary facilities installed pursuant to 
section 2.55, are jurisdictional as well.\21\
---------------------------------------------------------------------------

    \20\ Hence the title of section 2.55, Definition of terms used 
in section 7(c), and the placement of section 2.55 in Part 2, 
General Policy and Interpretations.
    \21\ If facilities are installed in reliance on section 2.55, 
but do not meet the criteria of this section, then they are 
jurisdictional facilities installed without the requisite Commission 
certificate authorization. For example, in Algonquin, after finding 
facilities installed under color of section 2.55(a) did not qualify 
under that section, we directed the company to show cause ``why it 
did not violate and is not violating section 7(c) of the Natural Gas 
Act by constructing and operating [facilities] without obtaining a 
certificate from the Commission.'' 57 FERC ] 61,052, at 61,205-06. 
The company subsequently obtained case-specific certificate 
authorization for the facilities at issue in Boston Gas Company, 70 
FERC ] 61,122, Ordering Paragraph (F) (1995).
---------------------------------------------------------------------------

    14. INGAA states that the NGA mandates that any jurisdictional 
facility must be certificated. We concur. As we have stated: ``Section 
2.55 of the Commission's regulations serves, in effect, as standing 
authorization for pipelines to perform periodic maintenance and routine 
replacement'' in order to ``permit pipelines to undertake limited 
construction projects without waiting for NGA section 7(c) case 
specific certificate authorization.'' \22\ In other words, section 2.55 
grants automatic certificate authorization for a limited class of 
facilities.
---------------------------------------------------------------------------

    \22\ Emergency Reconstruction of Interstate Natural Gas 
Facilities Under the Natural Gas Act, Notice of Proposed Rulemaking, 
68 FR 4120 (January 28, 2003), FERC Stats. & Regs. ] 32,567, at 
34,679-80 (2003). In the interest of administrative and industrial 
efficiency, we have dismissed requests for case-specific section 7 
certificate authorization for facilities that qualified for this 
``standing authorization'' provided by section 2.55. For example, in 
Columbia Gas Transmission Corporation, 68 FERC ] 61,156, at 61,743 
(1994), we dismissed a request for case-specific section 7 
certificate authorization to install a pigging and a methanol 
injection system after finding that the proposed facilities would 
serve only for the purpose of obtaining more efficient or more 
economical operation of an authorized transmission system, and thus 
qualified as auxiliary facilities that could and should be installed 
under section 2.55(a).
---------------------------------------------------------------------------

    15. To qualify under section 2.55(a), facilities must serve ``only 
for the purpose of obtaining more efficient operation or more 
economical operation of the authorized or proposed

[[Page 72798]]

transmission facilities'' (emphasis added).\23\ Therefore, we have 
always assumed that section 2.55(a) would necessarily be confined to 
projects small enough and inconsequential enough that their 
environmental and economic impacts would not merit the close scrutiny 
provided by (and time and expense consumed by) case-specific NGA 
section 7 review.\24\ Auxiliary facilities installed in reliance on 
section 2.55(a) will be added either to existing interstate 
transmission facilities that were subject to environmental review prior 
to construction or to a proposed project, in which case the applicant 
must identify in its certificate application the auxiliary facilities 
it plans to install in conjunction with the project, so that the 
auxiliary facilities will be included in the review of the project's 
environmental impacts.\25\ In the case of section 2.55(b) replacement 
facilities, an environmental review was performed prior to construction 
of the existing facilities to be replaced,\26\ and the replacement 
facilities must be in the same right-of-way and be substantially 
equivalent in design capacity to the existing facilities.\27\
---------------------------------------------------------------------------

    \23\ Supra n.6.
    \24\ The sentiment in Order No. 603-A, 64 FR 54522 at 54524, 
FERC Stats. & Regs. ] 31,081, that replacements ``should only 
involve basic maintenance or repair to relatively minor facilities 
where the Commission has determined that no significant impact to 
the environment will occur'' is applicable as well to auxiliary 
installations.
    \25\ As discussed above, if a company plans to rely on section 
2.55(a) to install auxiliary facilities in conjunction with a 
project under its Part 157 blanket construction certificate that it 
is subject to prior notice, the company must give the Commission 
notice of the type and planned location of auxiliary facilities at 
least 30 days prior to installation. See 18 CFR 2.55(a)(2)(ii) 
(2013).
    \26\ In the case of existing facilities constructed pursuant to 
blanket certificate authority, the facilities' construction was 
subject to the blanket program's section 157.206(b) environmental 
compliance provisions.
    \27\ For example, if a natural gas company wants to replace a 
deteriorated section of 12-inch-diameter pipe with 24-inch-diameter 
pipe, it generally cannot rely on section 2.55(b) to undertake such 
work, as the use of larger pipe could require larger equipment and 
greater ground disturbance and thus raise environmental issues that 
were not considered when the12-inch-diameter pipeline was 
authorized. In addition, while the replacement of deteriorated 
facilities is necessary to maintain existing service levels, section 
2.55 does not provide the opportunity for a company's customers to 
raise issues regarding the replacement project's cost. Thus, 
limiting replacement activities under section 2.55(b) to the 
construction of facilities that will be substantially equivalent in 
design capacity to the existing facilities is appropriate. If a 
company believes that there is a need for the replacement facilities 
to have significantly greater capacity, it can undertake the 
replacement project under its Part 157, Subpart F blanket 
construction certificate program, subject to the regulations' cost 
limits and environmental conditions. If the replacement project will 
exceed the blanket certificate cost limits or the company cannot 
satisfy the blanket certificate regulations' environmental 
conditions, the company can file an application for case-specific 
certificate authority and initiate a proceeding in which its 
customers and other parties can raise any concerns. Note that as 
discussed in the NOPR, to account for subsequent modifications 
having been made to original facilities--in particular blanket 
certificate projects that in adding to or altering original 
facilities establish new permanent right-of-way and new temporary 
work space--we will revise the section 2.55(b)(1)(ii) requirement 
that replacements must be confined to areas authorized for the 
``original facility'' to allow for replacements within areas 
authorized for the ``existing facility.''
---------------------------------------------------------------------------

    16. Since the wording of section 2.55 of the regulations cannot 
work to exclude auxiliary and replacement facilities from the scope of 
our jurisdiction under NGA section 7, section 2.55 effectively provides 
not an NGA-exemption, but a type of ``blanket'' certificate authority, 
so that a company does not need to seek additional, specific 
certificate authority to add minor auxiliary facilities to its 
previously certificated facilities or to replace its previously 
certificated facilities. Section 2.55 provides pre-granted or automatic 
certificate authorization to a specific, limited set of facilities, and 
does so to avoid triggering an unnecessary level of review for certain 
minor modifications to an existing or pending interstate transmission 
system. Section 2.55 is both a precursor and complement to our Part 157 
blanket certificate program. By providing non-case specific certificate 
authorization for limited classes of facilities, the section 2.55 and 
blanket certificate regulations permit companies to satisfy the 
requirements of section 7(c) without having to apply for individual 
case-specific certificates for each and every modification to their 
systems.
2. Section 2.55 Siting and Construction Limitations
    17. In 1994, we first had cause to clarify the parameters of 
section 2.55, in response to a request to increase operating pressures 
and make other changes to a pipeline system in Arkla Energy Resources 
Company (Arkla).\28\ In reviewing the existing facilities, it came to 
light that Arkla had undertaken several years before, in reliance on 
section 2.55(b), to replace 91 miles of old 18-inch-diameter pipe on a 
segment of its system by abandoning it in place and installing new 20-
inch-diameter pipe along a parallel path, which had required widening 
the existing right-of-way along portions of the route by an additional 
25 feet. We acknowledged that (1) section 2.55(b) did not ``specify 
whether replacement facilities must be constructed in the existing 
right-of-way,'' and that (2) there was no case law that ``directly 
addressed this issue.'' \29\ However, we explained that construction 
outside the right-of-way that was studied and authorized for the 
existing facilities potentially could have environmental impacts that 
had not been included in our environmental review of the facilities 
being replaced.\30\ Thus, we clarified that:
---------------------------------------------------------------------------

    \28\ 67 FERC ] 61,173 (1994), order on reh'g, NorAm Gas 
Transmission Company, 70 FERC ] 61,030 (1995) (Arkla/NorAm). Arkla 
was in the process of changing its name to NorAm at the time the 
Commission issued its order finding that Arkla's replacement project 
did not qualify to go forward under section 2.55(b). Thus, Arkla 
sought rehearing under its new name.
    \29\ 67 FERC ] 61,173 at 61,516.
    \30\ Id.

    [S]ection 2.55(b) means that replacement facilities must be 
constructed within the existing right-of-way. The reason is simple. 
The authority to replace a facility and to establish a right-of-way 
should be limited by the terms and locations delineated in the 
original construction certificate. Thus, a certificate holder that 
later establishes a new right-of-way for purposes of replacement 
engages in an unauthorized activity which is outside the parameters 
of the original certificate order.\31\
---------------------------------------------------------------------------

    \31\ Id. As we noted in Arkla/NorAm, at the time replacement 
activities limited to the existing right-of-way were categorically 
excluded by section 380.4(24) based on the assumption that impacts 
on the environment will be insignificant if construction activities 
to replace facilities are limited to work within a pipeline's 
existing compressor station yard or right-of-way. Following Arkla/
NorAm, we concluded that even if construction activities will be 
confined to the existing right-of-way, there may be the need for 
further environmental review if a replacement project involves the 
construction of extensive facilities, or there have been changes in 
land use over time in the vicinity of the existing facilities (for 
example, the existing facilities may have been constructed in an 
area that was rural in nature at the time but is now densely 
populated), or the pipeline company's replacement project may be 
associated with the construction of other, non-jurisdictional 
facilities that could also have environmental impacts. We rectified 
the situation in Order No. 544, explaining that because we have ``a 
responsibility under NEPA to review replacement activities that pose 
potentially serious, adverse environmental impact . . . we need to 
be informed of such activities before they occur.'' Order No. 544, 
57 FR 46487, at 46491 (October 9, 1992); FERC Stats. & Regs. ] 
30,951, at 30,686-87 (1992). Thus, while most replacement projects 
involve minor facilities and no potential for significant 
environmental impacts, we amended section 2.55(b) to require that 
companies notify us at least 30 days prior to commencing replacement 
projects so that there is time for staff to assess whether the 
project needs to be delayed in order to conduct further 
environmental review.

    18. We subsequently codified this Arkla/NorAm clarification in 
Order No. 603 by amending section 2.55(b) to add the phrase ``will be 
located in the same right-of-way or on the same site as the facilities 
being replaced, and will be constructed using the temporary work space 
used to construct the original

[[Page 72799]]

facility.'' \32\ In this rulemaking proceeding, we are clarifying that 
this same right-of-way/work space limitation is equally applicable to 
auxiliary installations under section 2.55(a). Rather than provide 
clarification in a case-specific proceeding, as the Commission did in 
Arkla/NorAm, and then revise the regulation in a subsequent rulemaking 
proceeding, here we conflate clarification-to-codification for section 
2.55(a) into this single proceeding.
---------------------------------------------------------------------------

    \32\ Order No. 603, 64 FR 26572 (May 14, 1999), FERC Stats. & 
Regs. ] 31,073 (1999). INGAA asserts the NOPR in this proceeding 
erroneously stated that the Commission did not address section 
2.55(a) auxiliary facilities in Order No. 603 when it revised 
section 2.55(b) to limit replacement projects to the originally 
authorized rights-of-way and work spaces for the existing 
facilities. While, as noted above, Order No. 603 did indeed address 
section 2.55(a) auxiliary facilities, specifically adding the 
notification requirements of section 2.55(a)(2), Order No. 603 did 
not address the right-of-way requirements relating to the 
installation of auxiliary facilities because the Commission assumed 
that there would be no need for gas companies to go outside 
previously authorized or proposed rights-of-way and work spaces in 
order to install minor facilities that, as specified in section 
2.55(a), are ``merely auxiliary or appurtenant'' to and ``only for 
the purpose of obtaining more efficient or more economical operation 
of the authorized or proposed transmission facilities.'' We 
explained in the NOPR in this proceeding that Order No. 603, as it 
pertained to spatial limitations on the construction of facilities, 
dealt specifically with replacement facilities, and therefore only 
discussed the rationale for requiring section 2.55(b) replacement 
facilities to be located within an existing right-of-way. We also 
explained that no party raised any issue in the Order No. 603 
rulemaking proceeding regarding spatial limitations on the 
installation of auxiliary facilities under section 2.55(a), and 
therefore we saw no need in Order No. 603 to discuss whether the 
construction and location of auxiliary installations to enhance 
existing facilities must fall within the same footprint as the 
existing facilities. NOPR, FERC Stats. & Regs. ] 32,696 at P 15. The 
NOPR also pointed out that nothing in Order No. 603 evinced an 
intent to permit auxiliary facilities or auxiliary installation 
activities outside of authorized rights-of-way and work spaces. Id. 
Thus, although we accept that the NOPR could have provided a more 
precise summary of Order No. 603, we reject INGAA's claim that the 
NOPR misrepresented Order No. 603, particularly since the NOPR 
describes concerns discussed in Order No. 603 with respect to 
auxiliary facilities, and recites the resulting revisions made to 
section 2.55(a). Id. P 4.
---------------------------------------------------------------------------

    19. As in Arkla/NorAm, construction outside the right-of-way could 
have environmental impacts that were not included in our environmental 
review of the existing facilities. In such circumstances, we could not 
fulfill our NEPA responsibilities if we were to allow companies to 
continue acquiring additional rights-of-way and work spaces to install 
auxiliary facilities under color of section 2.55(a) in areas not 
included in the environmental reviews for existing and proposed 
transmission facilities. We must ensure that environmental reviews are 
performed and appropriate mitigation measures identified, and this NEPA 
obligation extends to additional areas landowners may cede to gas 
companies for jurisdictional activities or facilities. While the 
environmental review conducted by the Commission in a certificate 
proceeding encompasses a corridor wider than the right-of-way and 
temporary work spaces eventually authorized, land usage and other 
circumstances can change over time, particularly in areas in which no 
jurisdictional facilities are located, and the Commission's findings 
based on its environmental review in a past certificate proceeding may 
no longer be valid for the entire corridor originally studied. This 
makes it reasonable and necessary to confine all auxiliary facilities 
and construction activities under section 2.55 to Commission-authorized 
rights-of-way and work spaces.
    20. INGAA states that ``[t]he Commission has not been confronted 
with issues resulting from auxiliary installations outside an existing 
right-of-way similar to the issues that arose in Arkla/NorAm from 
replacement facilities.'' \33\ We acknowledge that we are not aware of 
any section 2.55(a) auxiliary activities outside the authorized right-
of-way approaching the scale of the section 2.55(b) replacement 
activities outside the right-of-way that came to light during the 
Arkla/NorAm proceeding.\34\ Nevertheless, the issues raised for 
sections 2.55(a) and (b) activities are the same.\35\ We covered these 
issues in the NOPR, identifying our principle concern as the absence of 
any review of the environmental impacts of activities outside of 
authorized areas.
---------------------------------------------------------------------------

    \33\ INGAA's January 2013 Comments at p. 15.
    \34\ Arkla had made numerous egressions from the existing right-
of-way and acquired significant additional land rights without the 
Commission's knowledge in order to widen the existing right-of-way 
by 25 feet along significant portions of the 91 miles of pipeline 
that was replaced. Arkla had needed the wider right-of-way in order 
to use larger-diameter replacement pipe that it laid alongside the 
old pipe that was abandoned in place.
    \35\ See Arkla 67 FERC ] 61,173 at 61,517-18.
---------------------------------------------------------------------------

    21. INGAA emphasizes that ``cathodic protection equipment,'' 
``electrical and communication equipment,'' ``pig launcher/receivers,'' 
and ``buildings'' are listed specifically in section 2.55 as examples 
of auxiliary installations, and contends these types of facilities 
typically extend beyond a pipeline's right-of-way and/or require 
additional work space to install.\36\ We do not find these examples 
sufficient to preclude our action here. While we understand that the 
installation of any particular one of the types of facilities named in 
section 2.55(a)(1) may require additional right-of-way or work space, 
if this is the case, then that particular facility could not be 
installed pursuant to section 2.55(a). There are any number of cathodic 
protection equipment, electrical and communication equipment, pig 
launcher/receivers, and buildings that have been and can be added 
without straying beyond the confines of previously authorized areas, 
and such facilities can be installed pursuant to section 2.55(a). As 
discussed below, section 2.55(a) will continue to reduce the burden 
that would be imposed if every natural gas facility required case-
specific certificate authorization. Our decision to revise our 
regulations to explicitly confine section 2.55(a) auxiliary facilities 
to Commission-authorized rights-of-way and work spaces is necessary to 
clarify industry misinterpretations and to meet our obligations under 
NEPA, as discussed above, which cannot be fulfilled if we allow 
companies to construct auxiliary facilities in areas outside of 
existing rights-of-way. Further, while less convenient, most auxiliary 
installation projects that do not qualify under section 2.55(a) because 
additional right-of-way or work space is needed can be undertaken by 
companies by relying on their Part 157 blanket construction 
certificates, subject to those regulations' environmental and cost 
conditions. If a company cannot satisfy the blanket certificate 
regulations' environmental and cost conditions, it can file an 
application to initiate a proceeding for case-specific certificate 
authority, during which the Commission will conduct an

[[Page 72800]]

environmental review and identify any appropriate mitigation 
measures.\37\
---------------------------------------------------------------------------

    \36\ See INGAA's January 2013 Comments at p. 31. In several 
instances, commentors describe contemporary cathodic protection 
components as often being located outside an established right-of-
way. However, in 1949 when ``cathodic protection equipment'' was 
included in section 2.55(a), cathodic protection commonly was 
provided by passive systems that rely on the electrical potential 
between the pipeline and anode. Such systems require close spacing 
between the pipeline and anode, and therefore would likely be placed 
within the right-of-way. Thus, the inclusion of cathodic protection 
equipment in the list of auxiliary facilities that may qualify for 
purposes of section 2.55(a) reflected the fact that, at least in 
some instances, additional right-of-way or work space is not needed 
to install such equipment. The 1949 inclusion of ``cathodic 
protection equipment'' in section 2.55(a) did not anticipate the 
impressed current systems commonly used today, which require that 
anodes be placed some distance (e.g., 100 meters) from the pipeline, 
far beyond the typical width of right-of-way needed or authorized 
for laying pipe in the ground. Nonetheless, we note that impressed 
current systems which use deep well anode beds, can be set entirely 
within the typical width of a right-of-way and can qualify under 
section 2.55(a).
    \37\ For example, a company that needs a larger right-of-way and 
more work space for pig launching equipment will not be able to 
install the equipment under its Part 157 blanket certificate if in 
the course of performing required surveys an endangered species is 
identified. In that case, the company may still be able to go 
forward with the project if it files an application for case-
specific certificate authority, depending on the results of the 
Commission's environmental review, including the required formal 
consultation with the U.S. Fish and Wildlife Service, and whether 
adequate mitigation measures to protect the endangered species can 
be fashioned.
---------------------------------------------------------------------------

    22. Commenters raised specific examples. INGAA, Southern Star, and 
National Fuel observe that the list of auxiliary installations includes 
``buildings,'' and contend that generally it is not feasible to 
construct buildings within the previously authorized right-of-way 
containing existing pipeline facilities. They assert that the inclusion 
of ``buildings'' in section 2.55(a) therefore is at odds with the 
NOPR's position that section 2.55(a) has never authorized the 
construction of auxiliary facilities on newly acquired right-of-way. 
Obviously, as Southern Star points out, a gas company is not going to 
be able to locate a large new headquarters building for hundreds of 
personnel within an existing right-of-way authorized for a 
pipeline.\38\ However, we do not agree that the inclusion of 
``buildings'' in section 2.55(a) implicitly validates companies' 
reliance on section 2.55(a) to construct even small buildings such as a 
tool shed on newly acquired right-of-way.\39\ While section 2.55(a) can 
be relied upon to construct housing for compression, communication, 
electrical and other equipment and facilities needed to operate 
pipeline systems, section 2.55(a) can only be relied upon when such 
structures can be located within existing or proposed rights-of-way or 
facilities' site. Just as section 2.55(a) cannot be relied upon to 
install auxiliary facilities if a company will need to use a temporary 
work space that was not studied during a prior environmental review by 
the Commission, section 2.55(a) also is not intended for auxiliary 
installations where a gas company's plans include other types of land 
use described by INGAA and National Fuel, such as construction of a new 
access road or the temporary use of previously undisturbed land to 
store pipe, equipment, or machinery. While the commentors point out 
that a company generally does not need certificate authority to acquire 
the land rights to construct an access road or to store equipment and 
machinery, this makes no difference in whether a project qualifies 
under section 2.55(a).
---------------------------------------------------------------------------

    \38\ Southern Star's Comments at p. 4.
    \39\ We note that a new corporate headquarters building is not a 
``natural gas facility'' which requires certification under the NGA.
---------------------------------------------------------------------------

    23. Our goal is to ensure that the authorization provided by 
section 2.55 does not inadvertently work to deprive the Commission of 
the opportunity to conduct an environmental review and impose 
appropriate mitigation measures in any situation where a natural gas 
company's construction activities may have adverse environmental 
impacts. Thus, even when all planned auxiliary facilities can be 
located entirely within an existing or proposed right-of-way, a project 
does not qualify under section 2.55(a) if construction of the auxiliary 
facilities will be undertaken in conjunction with other activities, 
such as building an access road or clearing and leveling nearby areas 
to store materials or equipment, that will occur outside the existing 
or proposed right-of-way and use areas that have not been 
environmentally reviewed in connection with the past or pending 
construction of other jurisdictional facilities. If a pipeline company 
plans to disturb any area in the process of constructing auxiliary 
facilities that was not or will not be subject to environmental review, 
the company must undertake the auxiliary installation under the Part 
157 blanket certificate regulations or file an application for case-
specific certificate authority so that the Commission has an 
opportunity to conduct an environmental study to consider related 
activities in the vicinity of the auxiliary installation activities, 
such as construction of an access road or use of land to store 
materials or machinery.
    24. INGAA also comments on section 2.55(a)'s specification of 
``electrical and communication equipment,'' a category that has 
expanded enormously since 1949. INGAA states that a communications 
tower qualifies as ``electrical and communication equipment'' and 
``typically involves erecting a 40-foot-tall, three-leg tower with 
associated microwave parabolic dish antennas, . . . may include a self-
contained communications building and backup generation,'' and requires 
``a 40-foot by 60-foot area that typically would not fit within a 
pipeline's existing right-of-way.'' \40\ While we recognize it is 
unlikely the entire footprint of such a communication tower can fit 
within the confines of an existing authorized right-of-way or facility 
site, as noted above, we find that this example is as an exception to 
section 2.55(a) and not characteristic of all electric and 
communication equipment, some of which can be installed within an 
existing right-of-way. As stated above, we cannot fulfill our NEPA 
responsibilities if we allow section 2.55(a) projects to use right-of-
way and work space areas that have not been reviewed for environmental 
purposes. We have explained that if a structure is needed to ensure a 
company's compliance with current regulations (e.g., safety, security, 
or reliability standards), but does not meet section 2.55 right-of-way/
work space requirements, then the company must obtain blanket or case-
specific certificate authorization for the project.
---------------------------------------------------------------------------

    \40\ INGAA's January 2013 Comments at p. 31.
---------------------------------------------------------------------------

    25. Moreover, the fact that these types of facilities are 
specifically listed in section 2.55(a) does not mean that companies can 
necessarily rely in all instances on section 2.55(a) to install them.
    26. As discussed herein, when companies plan to construct auxiliary 
facilities in conjunction with projects for which they need to file 
applications under Part 157, Subpart A for case-specific certificate 
authority, section 2.55(a)(2)(iii) requires the companies to describe 
in the case-specific certificate proceedings any auxiliary facilities 
that they plan to install under section 2.55(a) and provide location 
maps.\41\ Thus, in a case-specific certificate proceeding, a company 
needs to include in the proposed right-of-way and temporary work spaces 
for which it seeks certificate authorization any additional areas it 
will need to install the planned auxiliary facilities, notwithstanding 
that it intends to rely on section 2.55(a) for its authorization to 
construct the auxiliary facilities.
---------------------------------------------------------------------------

    \41\ See n.9.
---------------------------------------------------------------------------

    27. In addition, if a company has already requested or received a 
case-specific certificate, or is constructing under its Part 157 
blanket certificate subject to those regulations' prior notice 
provisions, and decides prior to placing those facilities in service 
that it also wants to install auxiliary facilities, then section 
2.55(a)(2)(ii) requires that the company give the Commission at least 
30 days advance notice so that staff has time to consider any 
additional environmental impacts associated with the auxiliary 
facilities.\42\ The fact that section 2.55(a)(2)(ii) literally requires 
advance notice only if the auxiliary facilities are to be added to 
facilities that are not yet in service does not mean that companies can 
escape environmental review when they want to add auxiliary facilities 
to facilities that are already in

[[Page 72801]]

service. The installation of auxiliary facilities within previously-
established rights-of-way and work spaces will be within the scope of a 
completed environmental review and conform to the mitigation measures 
resulting from that review, whereas the installation of auxiliary 
facilities outside of established rights-of-way or work spaces can 
impose unstudied (and thus unmitigated) environmental impacts, which is 
why section 2.55(a) and (b) activities must be restricted to rights-of-
way, facility sites, and work spaces that have been reviewed and 
approved.
---------------------------------------------------------------------------

    \42\ See 18 CFR 2.55(a)(2)(ii) (2103). The advance notification 
must include a description of the auxiliary facilities and their 
planned location.
---------------------------------------------------------------------------

    28. The commentors stress that in Arkla/NorAm and Order No. 603, 
the Commission focused its attention on section 2.55(b) and infer from 
this that the right-of-way/work space limitation that was explicitly 
applied to replacement facilities is implicitly inapplicable to 
auxiliary installations. This inference is incorrect. It was companies' 
overly expansive reading of section 2.55(b), first noted and addressed 
in Arkla/NorAm, which prompted the Commission to revise section 2.55(b) 
in Order No. 603 to limit companies' replacement project activities 
under that section to the use of existing rights-of-way and previously 
disturbed temporary work spaces. We were not aware, at that time, of 
companies also relying on section 2.55(a) to go outside previously 
authorized areas, in that case in order to add auxiliary facilities to 
existing facilities. Thus, when we issued Order No. 603, we had no 
reason to lay out our expectations regarding locational requirements as 
they pertained to auxiliary installations under section 2.55(a), even 
though we were clarifying those requirements with respect to 
replacement projects under section 2.55(b).\43\
---------------------------------------------------------------------------

    \43\ As WBI Energy observes: ``Section 2.55(b) projects can 
involve replacing dozens or even hundreds of miles of pipeline and 
transmission service related facilities. Section 2.55(a) auxiliary 
installations, on the other hand, are much smaller projects with 
limited scope such as pig launchers, valves and cathodic protection 
equipment.'' WBI Energy's Comments at p. 5. As we have observed: 
``Auxiliary installations and taps generally involve minor 
facilities; however, replacement of facilities may involve the 
removal and replacement of extensive mainline facilities.'' Interim 
Revisions to Regulations Governing Construction to Facilities 
Pursuant to NGPA Section 311 and Replacement of Facilities, Order 
No. 525, 55 FR 33011 at 33013, FERC Stats. & Regs. ] 30,895 at 
31,812 (1990).
---------------------------------------------------------------------------

    29. However, over the last several years, we began to receive 
anecdotal indications that the industry might be applying an 
unwarrantedly expansive interpretation to section 2.55(a).\44\ In 
response, Commission staff--in conferences, meetings, and other public 
and private settings--sought to remind the industry that auxiliary 
installations, like replacement projects, must not stray outside of 
authorized rights-of-way and work spaces. While INGAA states that 
Commission staff's consistent and insistent stance in this matter 
prompted its petition requesting that the Commission disavow staff's 
statements, INGAA's request for clarification also serves to highlight 
how the industry is improperly interpreting section 2.55(a) to 
undertake construction of facilities that do not qualify under that 
section because they involve siting the facilities and/or engaging in 
construction activities outside of authorized areas.
---------------------------------------------------------------------------

    \44\ Commission staff received questions from the industry 
inquiring whether it was appropriate to install certain facilities 
(including, but not limited to, cathodic protection equipment, pig 
launchers, communications equipment) outside of the company's 
authorized right-of-way using section 2.55 authority.
---------------------------------------------------------------------------

    30. When Arkla/NorAm clarified that section 2.55(b) was restricted 
to replacements within the originally authorized right-of-way for the 
facilities being replaced, companies complained the Commission was 
upending long-held industry expectations and imposing an impractical 
constraint. Comments on the NOPR in this proceeding regarding auxiliary 
projects under section 2.55(a) recycle the objections presented on 
rehearing in Arkla/NorAm, namely: ``the Commission failed to articulate 
the reason for its change in policy''; ``the Commission's rationale 
underpinning'' its ``clarification is inadequate and inconsistent with 
the history and purpose of section 2.55(b)''; the ``clarification is 
unduly burdensome because it deprives pipelines of needed flexibility 
when repairing mainline facilities'' and ``that less burdensome 
alternatives are available''; ``clarification constituted an arbitrary 
and capricious action because it will create significant and 
unjustifiable regulatory burdens''; and the right-of-way specification 
constituted a ``rulemaking which failed to satisfy the notice and 
comment procedures of section 533 of the Administrative Procedure 
Act.'' \45\
---------------------------------------------------------------------------

    \45\ Arkla/NorAm, 70 FERC ] 61,030 at 61,099. Later, when the 
Commission proposed to revise the text of section 2.55(b) to 
incorporate the Arkla/NorAm clarification, comments emphasized the 
impracticality of corralling replacement construction activities 
within the originally authorized rights-of-way and workspaces.
---------------------------------------------------------------------------

    31. The discussion, rationale, and result in the 1995 Arkla/NorAm 
rehearing could serve as our response to the comments on the NOPR. The 
Commission's orders in Arkla/NorAm ``aimed at removing any possible 
confusion within the industry concerning section 2.55'' \46\ by 
responding to the ``mistaken belief '' \47\ that section 2.55 permitted 
companies to replace obsolete facilities with new facilities outside 
rights-of-ways that were authorized for the facilities being replaced 
or to engage in any construction activities outside the existing right-
of-way and previously disturbed work spaces. The clarification provided 
by the NOPR in this proceeding was aimed at the same mistaken belief on 
the part of some industry members with respect to section 2.55(a). Just 
as the Commission explained in Arkla/NorAm that, despite arguments to 
the contrary, it had ``not changed its interpretation of what 
replacement facilities qualify'' and can be installed under section 
2.55(b),\48\ the clarification in the NOPR in this proceeding did not 
reflect a change in the Commission's interpretation of what auxiliary 
facilities can be installed under section 2.55(a). Thus, we could have 
issued an instant Final Rule to codify our clarification of section 
2.55(a) without providing notice and opportunity, just as the 
Commission has modified section 2.55 several times in the past without 
notice and comment when such actions were interpretive in nature.\49\
---------------------------------------------------------------------------

    \46\ Id., at 61,100.
    \47\ Id.
    \48\ Id. 61,099-100.
    \49\ In Arkla/NorAm, the Commission noted previous amendments to 
section 2.55 that were treated as matters of interpretation, and as 
such implemented absent notice or hearing. Arkla/NorAm, 70 FERC ] 
61,030 at 61,100 and n.10, citing Order No. 220, 23 FPC 499 (1960) 
(including delivery taps as qualifying facilities for purposes of 
section 2.55); Order No. 241, 27 FPC 33 (1962) (revising the 
description of qualifying replacements for purposes of section 
2.55); and Order No. 148-A, 49 FPC 1046, 1047 (1973) (excluding 
delivery points). Arkla/NorAm also cited, at n.11, American Mining 
Congress v. Mine Safety & Health Admin., 995 F.2d 1106, 1112 (D.C. 
Cir. 1993), which describes traits of interpretive rules, to show 
these modifications to section 2.55 constituted interpretations 
that, consistent with the APA, did not require notice or hearing.
---------------------------------------------------------------------------

    32. Until relatively recently, the Commission had always assumed 
that companies understood when they relied on section 2.55(a) to add 
auxiliary facilities to facilities already in service, the new 
auxiliary facilities must be attached or immediately adjacent to the 
existing facilities and within the right-of-way authorized for the 
existing facilities and no additional right-of-way or work space could 
be acquired or used in order to add the auxiliary facilities to the 
existing facilities.\50\ As we did in

[[Page 72802]]

Arkla/NorAm for section 2.55(b), we apply ``a common-sense reading'' to 
section 2.55(a) and reach the same conclusions as we did with respect 
to our prior clarification of section 2.55(b), so that those auxiliary 
and replacement activities that qualify for purposes of section 2.55, 
and therefore require no additional certificate authority, are 
``delineated by the parameters of the certificate'' \51\ authorizing 
the transmission facilities that will be made more efficient or 
economic by adding auxiliary facilities under section 2.55(a) or be 
replaced under section 2.55(b).\52\
---------------------------------------------------------------------------

    \50\ See, e.g., Order No. 603-A, 64 FR 54522 at 54523, FERC 
Stats. & Regs. ] 31,081: ``Traditionally, Section 2.55 limited the 
installation of auxiliary facilities to facilities installed on an 
existing transmission system.'' This holds for all section 2.55 
facilities (including delivery points and taps during the period 
when they were covered under section 2.55), which have always been 
additions to or replacements of portions of a larger existing 
system, and as such have always been integrated into or substituted 
in place of jurisdictional facilities.
    \51\ 70 FERC ] 61,030 at 61,100.
    \52\ Id.
---------------------------------------------------------------------------

    33. Similarly under this common sense reading of section 2.55, we 
conclude that ``to the extent that facilities are built outside the 
scope of the certificate, such facilities are unauthorized.'' \53\ 
Thus, if auxiliary facilities are to be added to existing or proposed 
interstate transmission facilities, the auxiliary facilities will 
qualify for purposes of section 2.55(a) only if they will be located 
within the same right-of-way as the transmission facilities \54\ and 
construction activities will be limited to the temporary workspaces 
authorized for construction of the transmission facilities and conform 
to the conditions of the certificate authorizing construction of the 
transmission facilities (e.g., all required mitigation measures, such 
as erosion control or revegetation protocols, that applied to the case-
specific certificate or Part 157 blanket certificate authority under 
which the transmission facilities were constructed).\55\
---------------------------------------------------------------------------

    \53\ Id.
    \54\ Notice of Proposed Rulemaking, 68 FR 4120, FERC Stats. & 
Regs. ] 32,567 at 34,679. See also Emergency Reconstruction of 
Interstate Natural Gas Facilities Under the Natural Gas Act, Order 
No. 633, 68 FR 31596, at 31598-99 (May 28, 2003); FERC Stats. & 
Regs. ] 31,144, at 30,399 (2003).
    \55\ The bounds of a section 2.55 facility's authorization 
reflect the certificate conditions of the transmission system it 
modifies. For example, in Order No. 603-A, 64 FR 54522, FERC Stats. 
& Regs ] 31,081, at 30,921-22, the Commission was asked to permit 
section 2.55(b) projects to use ``Commission-approved rights-of-way 
unrelated to the construction of facilities being replaced'' on the 
grounds that ``any existing right-of-way that has already been 
disturbed for pipeline construction, has been reviewed'' for 
environmental impacts. The Commission rejected this request, 
reasoning that ``the existing right-of-way that was used to 
construct the original facilities should be sufficient,'' since 
replacements ``should only involve basic maintenance or repair to 
relatively minor facilities where the Commission has determined that 
no significant impact to the environment will occur.'' The 
Commission noted that in most instances gas companies would be able 
to ``use their blanket certificate authority to perform projects 
involving more extensive work that would need additional workspace, 
including the use of other unrelated rights-of-way,'' since the 
blanket procedures ``would allow for the required additional 
environmental scrutiny.''
---------------------------------------------------------------------------

    34. INGAA continues to argue that two Commission staff letters--one 
from 1984 and another from 1998--support INGAA's position that current 
Commission staff has been implementing a change in Commission policy by 
telling companies that they cannot rely on section 2.55(a) to construct 
auxiliary facilities if they need additional right-of-way or previously 
undisturbed areas as work space. As discussed in the NOPR, INGAA 
describes the April 1998 letter signed by Commission staff as accepting 
a proposed section 2.55(a) installation of cathodic protection 
equipment outside the right-of-way for the existing pipeline 
facilities.\56\ We note that in December 1997, Commission staff had 
issued a letter addressing what appears to be the same proposed 
cathodic protection project. In this earlier letter, staff recited the 
requisite section 2.55 criterion ``that, consistent with the 
Commission's previous determinations regarding 18 CFR Sec.  2.55(b), 
facilities constructed under section 2.55(a) must be placed within the 
permanent right-of-way.'' \57\ Staff explained in the December 1997 
letter that because a portion of the project would be located ``in a 
new right-of-way . . . in agricultural soil which was not previously 
disturbed by the pipeline construction,'' \58\ the project could not be 
installed under section 2.55(a); consequently, staff directed the 
company to ``file an application under Section 7 of the Natural Gas Act 
for authorization.'' \59\
---------------------------------------------------------------------------

    \56\ Letter signed by the Director of the Commission's Office of 
Pipeline Regulation, dated April 3, 1998; FERC eLibrary Accession 
No. 19980408-0242.
    \57\ Letter signed by the Director of the Commission's Office of 
Pipeline Regulations, dated December 16, 1997, p. 1 (citing Arkla/
NorAm and Columbia Gas Transmission Corporation, 68 FERC ] 61,173 
(1994), FERC eLibrary Accession No. 19971223-0120).
    \58\ Id.
    \59\ Id.
---------------------------------------------------------------------------

    35. Neither the April 1998 follow-up letter cited by INGAA 
accepting the cathodic protection installation under section 2.55(a) 
nor anything else in the record states where the new facilities 
ultimately were located. INGAA assumes that the new equipment was 
installed in new right-of-way, since the December 1997 letter describes 
the ground beds as being outside the right-of-way. We believe it is as 
likely that after receiving staff's 1997 letter, the company determined 
that it could locate the ground beds within the same right-of-way 
containing the existing pipeline facilities, in which case staff's 
December 1997 letter and April 1998 letter are consistent and correct; 
otherwise, as we acknowledged in the NOPR, the April 1998 letter did 
not reflect Commission policy correctly.\60\
---------------------------------------------------------------------------

    \60\ NOPR, FERC Stats. & Regs. ] 32,696 at P 11, n. 18 (cross-
referenced at 141 FERC ] 61,228).
---------------------------------------------------------------------------

    36. The 1984 Commission staff letter identified by INGAA stated 
that proposed facilities to remove liquid condensate and free water 
could qualify as an auxiliary installation for purposes of section 
2.55(a) as they would increase the efficiency and enhance the 
flexibility of the existing interstate pipeline system without altering 
the capacity of the system.\61\ INGAA emphasizes that staff's letter 
reached this determination, notwithstanding that the letter's 
description of the project indicated that some of the proposed 
facilities would be located outside the existing right-of-way. We find 
no indication that the location of the new facilities was taken into 
account in the one-page, two-paragraph staff letter which focuses 
exclusively on whether the new facilities would function, as the 
regulation requires, ``only for the purpose of obtaining more efficient 
or more economical operation.'' The order's failure to recognize the 
site of some the of proposed facilities as outside of the existing 
right-of-way appears to have been be an oversight that led to a wrong 
result, since locating any of the planned new auxiliary facilities 
outside the existing right-of-should have disqualified the project for 
purposes of section 2.55(a).
---------------------------------------------------------------------------

    \61\ Trunkline Gas Company, Docket No. CP84-394-000, letter 
order signed by the Director of the Commission's Office of Pipeline 
Regulation, dated May 25, 1984.
---------------------------------------------------------------------------

    37. At most, INGAA has identified two instances where Commission 
policy may not have been applied correctly. Further, both examples 
cited by INGAA were staff letters; neither was a Commission order. 
INGAA cannot plausibly argue that these two questionable examples must 
be accepted as representing a clear statement of Commission policy, 
particularly when INGAA acknowledges it filed its request for 
clarification expressly because ``[t]he Staff of the Federal Energy 
Regulatory Commission . . . has taken the position in informal 
conferences with pipelines and in industry meetings that Section 
2.55(a) of the Commission's regulations only applies to auxiliary 
installations in existing rights-of-way and where the

[[Page 72803]]

original work space is used,'' \62\ and because it strongly disagrees 
with ``Commission Staff's position . . . that the same right-of-way and 
work space requirements made expressly applicable to the replacement of 
facilities under Section 2.55(b) of the Commission's regulations are 
implied requirements of Section 2.55(a).'' \63\ In any event, 
regardless of whether some companies have thought they had some 
reasonable basis for expecting that construction activities to add 
auxiliary facilities to existing facilities can extend outside the 
previously authorized areas for the existing facilities,\64\ we cannot 
fulfill our NEPA responsibilities if we allow companies to continue 
acquiring additional rights-of-way and work spaces to install auxiliary 
facilities under color of section 2.55(a) in areas not included in the 
environmental reviews for existing and proposed transmission 
facilities. We must ensure that environmental reviews are performed and 
appropriate mitigation measures identified, and this NEPA obligation 
extends to additional areas landowners may cede to gas companies for 
jurisdictional activities or facilities.
---------------------------------------------------------------------------

    \62\ INGAA's April 2, 2012 Request for Clarification at p. 1, 
Docket No. RM12-11-000 (footnote omitted).
    \63\ Id.
    \64\ INGAA declares that ``[f]or over six decades, the 
interstate pipeline industry has considered auxiliary installations 
beyond the right-of-way to be acceptable.'' INGAA's January 2013 
Comments at p. 36. Echoing objections raised in Arkla/NorAm and 
Order No. 603, INGAA adds that our clarification ``represents a sea 
change in how the industry will address such installations, thereby 
raising costs, limiting efficiencies, and threatening expedited 
enhancement of pipeline integrity by making such installations more 
difficult to effectuate.'' Id. at 39.
---------------------------------------------------------------------------

    38. INGAA and WBI Energy point to the Commission's document titled 
Guidance on Repairs to Interstate Natural Gas Pipelines Pursuant to 
FERC Regulations (Guidance Document), which states that ``all 
replacement facilities must be constructed within the same right-of-
way, compressor station, or other aboveground facility site as the 
facility being replaced,'' but does not make a similar statement about 
auxiliary installations.\65\ INGAA maintains this omission ``reinforces 
the decisions'' made by Commission staff in the above-discussed 1997 
and 1984 letters.
---------------------------------------------------------------------------

    \65\ See http://www.ferc.gov/industries/gas/gen-info/guidance.pdf, at p. 3 (2005). (An updated Guidance Document was 
issued in August 2013).
---------------------------------------------------------------------------

    39. We do not share this assessment. The Guidance Document's 
summation of section 2.55, while highlighting the need for replacements 
to stay within authorized boundaries, does not include any discussion 
that would indicate auxiliary installations are intended to be exempt 
from this same constraint. The Guidance Document on repairs reflects 
the Commission's experience with section 2.55 projects, which is that 
the scale and impacts of section 2.55(b) replacement projects (e.g., 
Arkla/NorAm) can far exceed those of section 2.55(a) auxiliary 
installations. This is, as explained above, why we saw a need to spell 
out the right-of-way/work space restriction for replacements, and why--
until recently--we had not recognized that there apparently is a need 
to do the same for auxiliary facilities.
3. Environmental Issues
    40. INGAA contends the NOPR was incorrect in suggesting that all 
certificated gas facilities have undergone an environmental review 
prior to being constructed, because an environmental review was not a 
part of the Commission's certificate proceedings until after NEPA's 
promulgation in 1969. We acknowledge that NEPA altered the methodology 
employed by the Commission to evaluate the environmental impacts of a 
proposed project. For example, since NEPA, the Commission's orders 
granting applications for construction authorization generally have 
included a separate section addressing the potential environmental 
impacts of an applicant's proposed reasonable alternatives.\66\ 
However, the Commission has long recognized that determining whether 
proposed facilities are required by the public convenience and 
necessity requires that environmental consequences be taken into 
account (albeit in a far less methodical and thorough manner), and, 
when warranted, that constraints be imposed on projects' location, 
construction, and operation. For example, while prior to NEPA the 
Commission did not require an applicant to search historical county and 
state records to identify old burial sites no longer clearly marked as 
we do today, the Commission would not have permitted an applicant to 
lay a pipeline across a visible cemetery and any approval for a 
pipeline to cross any isolated graves would have been conditioned on 
their appropriate relocation.
---------------------------------------------------------------------------

    \66\ See Commission Regulations Implementing NEPA, 18 CFR part 
380 (2013).
---------------------------------------------------------------------------

    41. As the Commission observed in 1990 in adopting the advance 
notification requirement for more extensive replacement projects under 
section 2.55(b),\67\ when that section was promulgated in 1949 ``there 
were fewer pipeline construction projects and the majority of those 
projects involved relatively short lengths of small diameter 
pipeline.'' \68\ The Commission explained that the advance notification 
requirement was needed because over the years ``an integrated and 
sophisticated national pipeline gridwork has developed''; and 
``[w]hereas replacement of facilities when Sec.  2.55 was adopted could 
be assumed to involve minor projects, today, replacement of facilities 
could involve hundreds of miles of large diameter pipeline.'' \69\ The 
same reasoning holds for auxiliary installations, given the increase in 
the number, scale, and potential impacts of section 2.55 activities.
---------------------------------------------------------------------------

    \67\ As discussed above, the 30-day advance notification 
requirement applies to a replacement project under section 2.55(b) 
if project costs will exceed the Part 157 blanket certificate 
regulations' current cost limits for projects that qualify under the 
those regulations' automatic provision.
    \68\ Interim Revisions to Regulations Governing Construction of 
Facilities Pursuant to NGPA Section 311 and Replacement of 
Facilities, Order No. 525-A, 53 FERC ] 61,140, at 61,467 (1990).
    \69\ Id. The Commission also explained in Order No. 525-A that 
the advance notification requirement was needed for more extensive 
replacement projects under section 2.55(b) because changes could 
have occurred since an existing facility was put in place (e.g., the 
character of a region shifting from rural to residential), stating 
that:
    [J]ust because an area was disturbed when the pipeline was 
originally installed does not mean that replacing the old pipe with 
a new pipe will not potentially raise new environmental concerns. 
Such an action must be assessed in light of current land use, 
regulations, and concerns about erosion, sediment control, impact on 
streams and soil, threatened and endangered species and potential 
PCB contamination.
---------------------------------------------------------------------------

    42. While our NOPR in this proceeding clarified that section 
2.55(a) has always been limited to installations in authorized areas 
that have been or will be subject to environmental review, the NOPR 
also served to provide an opportunity for parties to convince us that 
this limitation is not necessary. Not only do INGAA's comments not 
change our view, they serve to reinforce our belief that section 2.55 
activities need to be confined to areas included within the existing 
right-of-way and previously-used construction workspace by pointing out 
that section 2.55 can be relied upon to replace or add auxiliary 
facilities to transmission systems that were authorized prior to NEPA 
when the Commission's environmental review would have been less 
rigorous and might not have identified project impacts that would come 
to light with today's greater scrutiny.
4. Compliance With Executive Orders
    43. The commentors claim the NOPR fails to follow Executive Orders 
directing agencies to weigh the burden

[[Page 72804]]

and benefit of regulations.\70\ They point out that section 2.55 was 
intended to avoid the burden of companies' having to obtain case-
specific certificate authorization for certain routine activities, and 
argue the purportedly new right-of-way/work space constraint will 
preclude some installations of auxiliary facilities under section 
2.55(a), and so compel companies to instead submit more individual 
certificate applications.
---------------------------------------------------------------------------

    \70\ Commenters cite Executive Order No. 13,563, Improving 
Regulation and Regulatory Review, 76 FR 3821 (January 21, 2011) 
(directing executive agencies and requesting that independent 
regulatory agencies such as the Commission ensure, inter alia, that 
their regulations have benefits justifying their costs and impose 
the least burden possible); Executive Order No. 13,579, Regulation 
and Independent Regulatory Agencies, 76 FR 41587 (July 14, 2011) 
(requesting that executive agencies, including independent 
regulatory agencies such as the Commission, retrospectively analyze 
their regulations and that regulations found to be outmoded, 
ineffective, insufficient, or excessively burdensome be modified, 
streamlined, expanded, or repealed); and Executive Order No. 13,211, 
Actions Concerning Regulations That Significantly Affect Energy 
Supply, Distribution, or Use, 66 FR 28355 (May 22, 2001) (requiring 
agencies other than independent regulatory agencies such as the 
Commission to prepare Statements of Energy Effects describing the 
effects of certain significant energy actions on energy supply, 
distribution, or use).
---------------------------------------------------------------------------

    44. We concur with the commentors' characterization of section 
2.55: it was put in place to, and continues to, reduce the burden that 
the industry (and Commission) would otherwise bear if every minor 
modification to a natural gas facility required case-specific 
certificate authorization. Further, while the Commission, as an 
independent agency, is not subject to the requirements of the cited 
Presidential documents, the Commission has directed staff to perform an 
internal assessment of the effectiveness of our regulations and is 
continually seeking to streamline the regulations in order to foster 
competitive markets, facilitate enhanced competition, and avoid 
imposing undue burdens on regulated entities or unnecessary costs on 
those entities or their customers.\71\ However, the NOPR, by more fully 
describing the types of activities that currently come within the 
bounds of 2.55(a), does not trigger any need for assessment of burdens 
and benefits, because the NOPR's clarification regarding the scope of 
section 2.55(a) does not alter any aspect of the status quo. Where the 
NOPR's proposed new regulations would impose an additional burden 
(e.g., the landowner notification requirements discussed below), then 
in accord with applicable Executive Orders, we explain the benefit we 
anticipate these new regulations will provide and quantify the burden 
we anticipate compliance will impose.
---------------------------------------------------------------------------

    \71\ See, e.g., Storage Reporting Requirements of Interstate and 
Intrastate Natural Gas Companies, Order No. 757, 77 FR 4220 (January 
27, 2012), FERC Stats. & Regs. ] 31,327, at PP 12-13 (2012).
---------------------------------------------------------------------------

5. Section 2.55 Authorization and Part 157, Subpart F, Blanket 
Authorization
    45. Under our Part 157, Subpart F blanket certificate regulations, 
as under our section 2.55 regulations, a gas company can construct and 
operate a limited class of facilities without the need to obtain 
separate certificate authorizations for each individual facility. 
INGAA, MidAmerican Energy, and National Fuel point to section 
157.202(b)(3) of our blanket certificate regulations, which in 
designating the types of facilities that may qualify for blanket 
authorization, states: ```Facility' does not include the items 
described in section 2.55.'' \72\ MidAmerican Energy is apprehensive 
this could be interpreted to mean that if an auxiliary facility does 
not qualify under section 2.55(a) because it does not meet the right-
of-way/work space constraints, then it also could not qualify as an 
eligible facility under the blanket regulations because of the section 
157.202(b)(3) limitation, thereby leaving a company with the ``only 
option'' of filing an application for case-specific certificate 
authorization.\73\
---------------------------------------------------------------------------

    \72\ 18 CFR 157.202(b)(3)(2013).
    \73\ MidAmerican Energy's Comments at p. 11.
---------------------------------------------------------------------------

    46. The Commission responded to a similar concern in 1999 in the 
Order No. 603 proceeding that codified the Arkla/NorAm clarification 
regarding replacement projects under section 2.55(b) by amending that 
section to add the phrase ``will be located in the same right-of-way or 
on the same site as the facilities being replaced, and will be 
constructed using the temporary work space used to construct the 
original facility.'' \74\ The Commission explained that section 
157.202(b)(3) only prevents companies from relying on their Part 157 
blanket certificates to construct facilities if the facilities qualify 
under section 2.55. As clarified by Order No. 603's revision to section 
2.55(b), replacement projects are disqualified under that section only 
if they will use additional right-of-way or work space than was used in 
constructing the facilities being replaced or will result in an 
incidental increase in capacity. Thus, section 157.202(b)(3) prevents 
companies from relying on their Part 157 certificates for replacement 
projects that will not use additional right-of-way or work space and 
therefore qualify under section 2.55.\75\
---------------------------------------------------------------------------

    \74\ Order No. 603, 64 FR 26572, FERC Stats. & Regs. ] 31,073.
    \75\ Order No. 603, 64 FR 26572 at 26580, FERC Stats. & Regs. ] 
31,073.
---------------------------------------------------------------------------

    47. Both section 2.55 and the blanket certificate program are 
intended to provide a streamlined authorization process to avoid the 
comparatively greater time, cost, and effort that accompany a case-
specific section 7 certificate application.\76\ To this end, we expect 
companies seeking to install, maintain, replace, repair, or upgrade 
facilities to look first to section 2.55, and only if an activity is 
beyond the scope of that section then to turn to blanket certificate 
authority, and only if an activity would exceed blanket authority, then 
to file for case-specific section 7 authorization.
---------------------------------------------------------------------------

    \76\ While section 2.55 covers a more limited range of 
facilities than the blanket program, it offers lighter-handed 
regulatory oversight than the blanket program.
---------------------------------------------------------------------------

    48. INGAA and National Fuel note we modified section 
157.202(b)(2)(i) to specify that replacements which do not meet section 
2.55(b) requirements may be eligible for blanket authorization \77\ and 
request we do the same for auxiliary installations. We will do so 
(although we believe this does not change the way the regulations 
currently function) to ensure clarity and consistency in the 
application of the regulations.\78\ Accordingly, to explicitly (and 
redundantly) specify that auxiliary installations which do not meet 
section 2.55(a) requirements may be eligible for blanket authorization, 
we will add the following sentence at the end of section 
157.202(b)(2)(i): ``Eligible facility includes auxiliary installations 
and observation wells which do not qualify under Sec.  2.55(a) of this 
chapter because

[[Page 72805]]

they will not satisfy the location or work space requirements of Sec.  
2.55(a).'' \79\

---------------------------------------------------------------------------

    \77\ Order No. 603 revised 157.202(b)(2)(i) to specify that 
eligible facilities include ``replacements that do not qualify under 
section 2.55(b) of this chapter because they will have an impact on 
mainline capacity.'' Order No. 603, 64 FR 26572 at 26579-80, FERC 
Stats. & Regs. ] 31,073.
    \78\ We note that in instances where a pipeline company needs to 
rely on its Part 157 certificate to construct auxiliary or 
replacement facilities because they do not satisfy the location or 
work space limitations of section 2.55, the Part 157 blanket 
certificate regulations impose no limitations on the placement of 
the facilities. While the Commission has indicated previously that 
it is contemplated that replacement facilities constructed under 
blanket authority would usually be located adjacent to, if not 
within, an existing right-of-way, sections 157.202(b)(2)(i) and 
157.210 permit the construction of non-main line facilities and main 
line facilities, respectively, without restriction on their 
location. For example, a company can rely on its Part 157 blanket 
certificate to replace the capacity of a segment of obsolete 
pipeline with new pipeline that may need to be located at 
considerable distance from the old pipeline in order to avoid a 
housing development constructed since the old pipeline was installed 
or to install auxiliary facilities such as anodes offset from the 
existing right-of-way to provide cathodic protection.
    \79\ In 1999, the Commission proposed adding the following 
sentence at the end of section 157.202(b)(2)(i): ``Eligible facility 
includes observation wells.'' Landowner Notification, Expanded 
Categorical Exclusions, and Other Environmental Filing Requirements, 
Notice of Proposed Rulemaking, 64 FR 27717 (May 21, 1999), FERC 
Stats. & Regs. ] 32,540 (1999). Ultimately, the Commission elected 
not to include the sentence based on its conclusion at the time that 
observation wells could be constructed under section 2.55(a). 
Landowner Notification, Expanded Categorical Exclusions, and Other 
Environmental Filing Requirements, 64 FR 57374 (October 25, 1999), 
FERC Stats. & Regs. ] 31,082, at 30,959 (1999). Commentors in this 
proceeding have pointed out that many observation wells, rather than 
being drilled to monitor operations at an existing gas storage 
facility, are drilled in order to determine whether a planned new 
storage facility is feasible, in which case a company may not have 
any existing right-of-way and would not be able to meet section 
2.55(a) requirements. In view of this, we will include observation 
wells in revised section 157.202(b)(2)(i) to ensure that if such 
wells are not able to meet section 2.55(a) siting restrictions, they 
will then be eligible to be considered for authorization under the 
blanket certificate program.
---------------------------------------------------------------------------

6. ``Grandfathering'' Existing Section 2.55(a) Installations
    49. For the reasons discussed above, we believe modifying section 
2.55(a) to codify right-of-way and work space constraints does no more 
than restate existing Commission policy and practice. Nevertheless, we 
acknowledge that although these constraints have been clear to the 
Commission, they may have been subject to misinterpretation by the 
industry.
    50. The commentors declare companies have relied on section 2.55(a) 
to install facilities that are not in compliance with right-of-way and 
work space requirements. As explained above, any such installations are 
NGA-jurisdictional facilities constructed and operated without NGA 
authority. However, given that section 2.55(a) did not previously 
include an explicit description of the inherent right-of-way/work space 
constraint, and in view of commentors' claims of companies' good faith 
reliance on section 2.55(a) to install facilities which violate this 
constraint, we will not require the companies to obtain a blanket or 
case-specific certificate authorization for thefacilities purportedly 
installed pursuant to section 2.55(a) prior to the effective date of 
this rule, provided such facilities comply with all other applicable 
federal, state, and local rules and regulations. That said, if we 
become aware of facilities installed relying on section 2.55(a) that do 
not meet the constraints of that section which are the cause of any 
significant adverse environmental impact, we may then require that such 
facilities obtain blanket or case-specific certificate authorization.
7. Burden of Section 2.55's Right-of-Way Requirement
    51. INGAA argues that we erred by not including the ``additional 
time and burden'' of blanket or case-specific section 7 procedures that 
will now be necessary for facilities that cannot meet section 2.55(a) 
siting requirements.\80\ This objection presumes the section 2.55(a) 
right-of-way/work space constraint constitutes a new burden imposed by 
this rule. As previously discussed, this not the case, because section 
2.55 activities have always been restricted to an authorized right-of-
way or facility site and prescribed work spaces. Activities that exceed 
these limits are not covered under section 2.55, and thus no additional 
time and burden is being imposed--they remain subject to the same time 
and burden that they were before. Consequently, we do not include 
activities that did not and will not qualify under section 2.55(a) in 
our estimate of the additional time and burden imposed by this rule.
---------------------------------------------------------------------------

    \80\ INGAA's March 2013 Comments at p. 5.
---------------------------------------------------------------------------

    52. INGAA asserts the ``NOPR would convert all auxiliary 
installations outside of existing rights of way and historical work 
spaces into Natural Gas Act jurisdictional facility construction that 
would require certificate authorization and formal agency 
consultation.'' \81\ We concur, but as noted, we will not compel 
companies to seek blanket or case-specific authorization for facilities 
installed in erroneous reliance on section 2.55(a) unless we find 
reason to suspect such facilities are a cause of significant adverse 
environmental impact. Where facilities already in place present no such 
issues, we find no reason to subject them to further review.
---------------------------------------------------------------------------

    \81\ INGAA's March 2013 Comments at p. 22.
---------------------------------------------------------------------------

    53. In any event, the NOPR and this Final Rule do no more than 
clarify the source of our authority over certain types of facilities. 
Therefore, we reject INGAA's claim that we include an estimate of the 
burden on companies of filing certificate applications and consulting 
with environmental agencies for facilities allegedly `converted' to 
blanket or case-specific status.

B. Landowner Notification

    54. This Final Rule adopts regulations to provide for advance 
landowner notification for auxiliary and replacement projects under 
section 2.55 and for maintenance activities under section 380.15. As 
previously discussed, we consider it appropriate to give landowners 
prior notice to the extent practicable before intruding onto their 
property as a courtesy and to avoid potential conflict between 
landowners and gas companies. Commentors do not dispute the virtues of 
informing landowners of company activities, but insist the notice 
procedures described in the NOPR are impractical.
    55. In response to commentors' concerns, we will revise the 
proposed notification obligations to (1) specify the types of 
maintenance activities that merit individual notice; (2) limit notice 
to landowners whose property is crossed or used for section 2.55 and 
section 380.15 activities; and (3) reduce the prior notice period from 
10 days to five days. These modifications should significantly diminish 
the burden of complying with the new requirements for prior notice to 
landowners.
    56. Instead of mandating notice to landowners for all section 
380.15 maintenance activities, as proposed in the NOPR, we will only 
require prior notice of those more substantial activities that will 
result in ground disturbance. In addition, we are reducing the scope of 
notification proposed in the NOPR, which would have required that 
notice be provided not only to directly affected landowners, but also 
to adjacent landowners and to landowners with a residence within 50 
feet of a proposed work area.\82\ Commentors assert this is overly 
broad and request that we remove abutting landowners and landowners 
with a residence within 50 feet of the proposed work area from the 
definition of ``affected landowners.'' Although the NOPR would have 
required the same scope of notice that companies are required to 
provide for projects under the Part 157 blanket certificate 
regulations, the commentors have convinced us that more limited 
landowner notification requirements are appropriate for companies' 
activities under section 2.55 and 380.15, since such projects are 
likely to be smaller, take a shorter period of time to

[[Page 72806]]

accomplish, and be less disruptive than blanket certificate projects.
---------------------------------------------------------------------------

    \82\ The NOPR defined ``affected landowners'' for purposes of 
companies' activities under sections 2.55 and 380.15 as ``owners of 
property interests, as noted in the most recent tax notice, whose 
property (1) is directly affected (i.e., crossed or used) by the 
proposed activity, including all rights-of-way, facility sites, 
access roads, pipe and contractor yards, and temporary work space; 
or (2) abuts either side of an existing right-of-way or facility 
site, or abuts the edge or a proposed right-of-way or facility site 
which runs along a property line in the area in which the facilities 
would be constructed, or contains a residence within 50 feet of the 
proposed construction work area.'' 78 FR at 683, NOPR, FERC Stats. & 
Regs. ] 32,696 at P 30 (corss-referenced at 141 FERC ] 61,228).
---------------------------------------------------------------------------

    57. Finally, while the NOPR stipulated a 10-day prior notice, we 
accept commentors' claim that some activities, particularly 
unanticipated maintenance, are not scheduled far enough in advance to 
allow for a 10-day prior notice.\83\ In view of this, we will only 
require that landowners receive notice five days in advance of 
initiating certain activity under section 2.55 or 380.15, which we 
anticipate will still allow time for landowners and a company to 
discuss any concerns landowners may have regarding companies' planned 
activities.
---------------------------------------------------------------------------

    \83\ Additionally, commentors state that the 10-day prior notice 
period prevents companies from adjusting maintenance schedules due 
to weather, equipment availability, permitting processes, etc.
---------------------------------------------------------------------------

1. Jurisdictional Basis and Need for Landowner Notification
    58. INGAA asserts that the Commission has no jurisdictional basis 
to impose landowner notification requirements for companies' 
installations of auxiliary facilities and replacement projects under 
section 2.55 or their maintenance activities under section 380.15; \84\ 
therefore, INGAA argues that the NOPR's proposed landowner notification 
requirements for these activities should not be adopted. However, if 
the Final Rule does adopt landowner notification requirements, INGAA 
asks the Commission to explain what circumstances changed since the 
promulgation of Order No. 609 \85\ to merit mandatory prior 
notification to landowners before a company commences construction 
under section 2.55 or maintenance under section 380.15.
---------------------------------------------------------------------------

    \84\ INGAA's March 2013 Comments at p. 7. INGAA cites to 
Californians for Renewable Energy, Inc., 133 FERC ] 61,194, at P 26 
(2010), to support its statement that ``[t]hus far, the Commission 
properly has refrained from exercising jurisdiction over easement or 
right-of-way agreements, and has appropriately deferred the formal 
resolution of disputes in such matters to the courts.'' We agree 
that formal resolution of disputes over the terms of easements and 
right-of-way agreements belong in the courts and we are not claiming 
jurisdiction over these matters by imposing landowner notification 
requirements for Commission-authorized activities.
    \85\ Order No. 609, 64 FR 57374 (October 25, 1999), FERC Stats. 
& Regs. ] 31,082 (1999).
---------------------------------------------------------------------------

    59. INGAA points out \86\ that in Order No. 609 the Commission 
determined that there was no need for landowner notification because 
section 2.55(b) replacements occur within an ``existing right-of-way 
and subject to an existing easement agreement, which dictates the 
pipeline's right to obtain access to maintain the facilities.'' \87\ 
However, Order No. 609 also stated that ``prudence would dictate that 
the pipeline should give the landowner as much advance warning as 
possible to avoid misunderstandings and ill-will.'' \88\
---------------------------------------------------------------------------

    \86\ INGAA's March 2013 Comments at pp. 6-7. INGAA also notes 
that ``[a] pipeline must own the property or have an easement to 
perform maintenance, and the same is true for a pipeline to install, 
modify, replace, improve, alter, operate, maintain, access, inspect, 
patrol, protect, abandon, etc. auxiliary installations and 
replacement facilities.'' Id. at p. 12.
    \87\ Order No. 609, 64 FR 57374 at 57382, FERC Stats. & Regs ] 
31,082.
    \88\ Id.
---------------------------------------------------------------------------

    60. Our proposal in the NOPR in this proceeding to adopt landowner 
notification requirements for companies' activities under section 2.55 
and section 380.15 was prompted by landowners' expressions of concern 
to Commission staff during phone inquiries, scoping meetings, and in 
other forums due to companies' personnel appearing unannounced on or 
near their property. The types of concerns expressed by landowners 
arise from construction and maintenance crews arriving unexpectedly to 
engage in activities that disrupt, or could disrupt, landowners use of 
their property, or damage their property as a result of replacing 
facilities; re-grading or replacing access roads; lowering pipelines; 
performing anomaly digs; or preventing and controlling erosion. We view 
providing prior notice, which some companies avow is routine practice, 
as the least burdensome and most practical way to ensure courtesy and 
preclude conflicts with landowners. Whenever a company conducts an 
activity subject to our jurisdiction and under authority provided by 
our regulations,\89\ we have a right and responsibility to impose 
appropriate and reasonable conditions on that activity.\90\ Our 
responsibility includes ensuring that, to the extent practicable, 
landowners are informed in advance when they may be inconvenienced or 
the use of their property may be disrupted by companies' jurisdictional 
activities to construct auxiliary and replacement facilities under 
section 2.55 authority or conduct maintenance activities subject to 
section 380.15. Landowners deserve an opportunity to express concerns, 
and we want the opportunity to act on those concerns if necessary.\91\
---------------------------------------------------------------------------

    \89\ In addition, section 157.14(a)(9)(iv) of the Commission's 
regulations requires an applicant for NGA section 7 certificate 
authority to certify that it will ``maintain the facilities for 
which a certificate is requested in accordance with Federal safety 
standards.'' 18 CFR 157.14(a)(9)(iv) (2013). Likewise, NGA section 
7(h) gives the certificate holder eminent domain authority to 
acquire rights necessary to ``construct, operate, and maintain a 
pipe line.'' 15 U.S.C. 717f(h) (2012). See Brian Hamilton, 141 FERC 
] 61,229, at PP 24-25 (2012) (Hamilton). Therefore, the Commission 
has jurisdiction over maintenance activities, and has the authority 
to require landowner notice as a condition of a company's 
jurisdictional maintenance activities.
    \90\ Contrary to National Fuel's assertion (see National Fuel's 
Comments at p. 2), the Commission is not restricted to requiring 
landowner notification only for companies' activities under their 
Part 157 blanket and case-specific certificates. As discussed supra 
PP 13-16 auxiliary and replacement facilities are NGA-jurisdictional 
facilities that can be constructed only with the requisite section 7 
certificate authority, which the Commission provided when it adopted 
section 2.55 as a precursor to the Part 157 blanket certificate 
construction program. Further, the authorization to perform 
maintenance on gas facilities comes from the certificate authority 
under which the facilities were or will be constructed--whether it 
be self-implementing section 2.55 certificate authority, Part 157 
blanket certificate authority, or case-specific certificate 
authority. As the Commission explained in Hamilton, 141 FERC ] 
61,229, at P 24, ``[i]t does not necessarily follow, however, that 
[a natural gas company] has no responsibilities merely because the 
activity neither falls within the replacement of facilities under 
section 2.55(b) nor under the blanket construction provisions. When 
the Commission authorizes a natural gas company to construct and 
operate pipeline facilities, the authority must necessarily include 
authority to maintain the pipeline.''
    \91\ National Fuel argues that the NOPR relied on NEPA as a 
basis for requiring landowner notification for maintenance 
activities. National Fuel's Comments at p. 3. It did not. The 
rationale for requiring notification is our belief that landowners 
should be informed in advance of any activity that will take place 
on their property as a consequence of our granting a company an NGA 
section 7(c) certificate. The jurisdictional basis for this 
requirement is as a condition to the certificate, which we impose to 
ensure company actions are consistent with the public interest. The 
NOPR, however, did rely on NEPA as a basis for restricting 
companies' activities to areas subject to an environmental review, 
and as a result thereof, authorized for a particular use.
---------------------------------------------------------------------------

    61. Commentors assert that easement agreements are the proper 
method for landowners to establish any requirements for prior notice of 
company activities on private property,\92\ and note that many of these 
agreements specify that no notice is required for maintenance 
activities. While we recognize that some landowners agree to forego 
prior notice, we nevertheless believe it is prudent for gas companies 
to provide such notice. Landowners may misunderstand the terms of an 
easement agreement or a subsequent owner may not be aware that the land 
is subject to an easement. Therefore, regardless of whether an easement 
agreement gives a company a right enforceable under state property law 
to enter on property without notice, we believe it is appropriate and 
reasonable for our regulations to require that to the extent 
practicable companies provide landowners with prior notice

[[Page 72807]]

before commencing certain activities under section 2.55 or section 
380.15.
---------------------------------------------------------------------------

    \92\ See INGAA's March 2013 Comments at pp. 6 and 12, Southern 
Star's Comments at p. 6, Golden Triangle's Comments at p. 4, WBI 
Energy's Comments at p. 7, and National Fuel's Comments at pp. 2-3.
---------------------------------------------------------------------------

2. Exceptions to Landowner Notification Requirements
    62. Commentors state that if the landowner notification proposals 
are adopted, the Final Rule should waive landowner notification to 
provide ``for immediate access to emergency gas leaks, acts of God, 
investigations related to gas pressure or flow or SCADA signals, or to 
respond to One Call notifications on an emergency or routine basis.'' 
\93\
---------------------------------------------------------------------------

    \93\ INGAA's March 2013 Comments at p. 9 and National Fuel's 
Comments at p. 5.
---------------------------------------------------------------------------

    63. Our regulations provide for a company to take immediate action 
in an emergency, as we pointed out in response to a similar concern 
regarding the imposition of a 30-day prior notice:

    [This] rule does not override other Commission regulations which 
permit interstate pipelines to take prompt corrective actions to 
address conditions that constitute a safety hazard. Subpart I of 
Part 284 of the Commission's regulations exempts emergency 
situations from the provisions of section 7 of the Natural Gas Act 
and permits a pipeline to take immediate action to alleviate an 
emergency situation subject to a subsequent 48-hour reporting 
requirement. Section 284.262(a)(1)(iii) of Subpart I defines 
emergency as ``Any situation in which . . . immediate action is 
required or is reasonably anticipated to be required for the 
protection of life or health or for maintenance of physical 
property.'' \94\
---------------------------------------------------------------------------

    \94\ Interim Revisions to Regulations Governing Construction of 
Facilities Pursuant to NGPA Section 311 and Replacement of 
Facilities, 52 FERC ] 61,252, at 61,877 (1990). See also section 
157.203(d)(3)(i), which states that ``no landowner notice is 
required'' for any blanket program ``replacement done for safety, 
DOT compliance, environmental, or unplanned maintenance reasons that 
are not foreseen and that require immediate attention by the 
certificate holder.''

Notwithstanding the foregoing, to assure there will be no hesitation by 
gas companies if immediate action is called for, we will specify in 
sections 2.55 and 380.15 that: ``For an activity required to respond to 
an emergency, the five-day prior notice period does not apply.'' Note 
that events that do not necessitate immediate access to system 
facilities would not trigger our section 284 emergency provisions, and 
therefore would still be subject to a five-day prior notice.
3. Part 157 Landowner Notification Exemption for Replacement Projects
    64. Companies are required to provide landowner notice prior to 
initiating projects under the Part 157 blanket certificate 
regulations.\95\ However, section 157.203(d)(3)(i) of the regulations 
provides a notice exemption for replacement projects that would have 
been done under section 2.55(b), but for the fact that the replacement 
projects are not of the same capacity.\96\ To provide consistency with 
new the section 2.55 landowner notification requirements established in 
this Final Rule, we will amend section 157.203(d)(3)(i) to provide that 
replacement projects that would have been done under section 2.55(b), 
but for the fact that the project alters the designed delivery capacity 
of the original facility, remains exempt from the landowner 
notification requirements of Part 157, as long as the project does not 
involve ground disturbance. Because the revised section 2.55(b) notice 
requirements require landowner notice for a ground disturbing 
replacement project that substitutes in a new same-size facility, it 
would be inconsistent to retain the landowner notice exemption in 
section 157.203(d)(3)(i) for a ground disturbing replacement project 
that alters the capacity of the original facility.
---------------------------------------------------------------------------

    \95\ 18 CFR 157.203(d)(1) (2013).
    \96\ 18 CFR 157.203(d)(3)(i) (2013). To qualify under section 
2.55(b) a replacement project must have a substantially equivalent 
designed delivery capacity as the original facility. 18 CFR 
2.55(b)(1)(ii) (2013).
---------------------------------------------------------------------------

4. Requirement That Notification Inform Landowners of the Availability 
of the Commission's Dispute Resolution Division
    65. WBI Energy states that any landowner notification requirements 
should not include a requirement that companies provide landowners with 
contact information or include a description of the Commission's 
Dispute Resolution Division (DRD) Helpline. WBI Energy asserts disputes 
concerning easements and right-of-ways for existing facilities are 
properly adjudicated in state courts, and not by the Commission. WBI 
Energy further argues that including information regarding the DRD in 
the notice likely would cause landowners to incorrectly believe that 
the Commission is the appropriate venue for resolving property 
disputes.\97\
---------------------------------------------------------------------------

    \97\ WBI Energy's Comments at pp. 8-9.
---------------------------------------------------------------------------

    66. We recognize that the DRD Helpline is not the appropriate venue 
for determining the respective rights of companies and landowners under 
state property law or for renegotiating the terms of easement 
agreements. However, there are instances in which it is appropriate 
and/or potentially helpful for landowners to contact Commission staff 
to seek informal resolution of a dispute. For example, while a court 
would be the appropriate forum to adjudicate a dispute regarding 
whether an easement agreement gives a natural gas company the right to 
allow another company to lay a fiber optic cable in the pipeline right-
of-way, or to determine the amount of monetary damages caused to a 
landowner's property by a company's negligence during construction 
activities, it is appropriate for a landowner to contact the Commission 
if the landowner believes that a company's planned activities might not 
comply with the provisions of section 2.55 (e.g., may not be confined 
to the existing right-of-way) or section 380.15 and for the 
Commission's staff to contact the company regarding the matter. It also 
is appropriate for a landowner to seek the Commission's assistance in 
obtaining a company's voluntary agreement to reasonable accommodation 
requested by the landowner (e.g., to reschedule backhoe digging planned 
by the company for the same day as a back-yard wedding reception). In 
this regard, we emphasize that section 380.15(b), Landowner 
consideration, states that ``[t]he desires of landowners should be 
taken into account in the planning, locating, clearing, and maintenance 
of rights-of-way and the construction of facilities on their 
property.''
    67. While only a court can determine the respective rights of a 
company and landowner under the terms of an easement agreement, the 
terms of an easement in no way diminish the Commission's NGA authority 
over companies' activities to construct or maintain jurisdictional 
facilities. Thus, we are adopting our proposal to require that 
companies include the DRD Helpline number to facilitate landowners 
being able to contact and seek assistance from Commission staff. We 
encourage companies to describe the DRD Helpline as a way for 
landowners to inform the Commission of concerns regarding a company's 
planned activities. We anticipate companies, in providing the DRD 
Helpline number, will be able to explain this without implying, as WBI 
Energy worries, that a company is acting unlawfully.\98\
---------------------------------------------------------------------------

    \98\ Id. In Order No. 609, in response to similar apprehensions 
regarding a requirement for companies to include information in 
landowner notices on how to contact the Commission's Enforcement 
Hotline, we stated we did not believe ``that including a reference 
to the Enforcement Hotline implies the company is doing something 
unlawful,'' and added that we expected companies ``will be able to 
present it as merely being a means to contact the Commission, which 
is in fact what it is.'' 64 FR 57374, 57384.
---------------------------------------------------------------------------

5. Landowner Notification for Maintenance Activities
    68. Commentors state that the Commission's proposed prior notice

[[Page 72808]]

requirements for maintenance activities may be unnecessary in view of 
existing U.S. Department of Transportation (DOT) regulations. DOT's 
Pipeline and Hazardous Materials Safety Administration (PHMSA) requires 
pipelines to develop a continuing public education program,\99\ which 
follows guidance provided by the American Petroleum Institute's (API).
---------------------------------------------------------------------------

    \99\ See 49 CFR 192.616 (2013).
---------------------------------------------------------------------------

    Recommended Practice 1162.\100\ API's Recommended Practice 1162 
requires that ``[w]hen planning pipeline maintenance-related 
construction activities,'' gas companies ``should communicate to the 
audience affected by the specific activity in a timely manner 
appropriate to the nature and extent of activity,'' \101\ and must also 
notify landowners in writing biennially of all ``planned major 
maintenance/construction activity.'' \102\
---------------------------------------------------------------------------

    \100\ See http://mycommittees.api.org/standards/pipeline/1162%20Links/1162nonprintable.pdf.
    \101\ See http://mycommittees.api.org/standards/pipeline/1162%20Links/1162nonprintable.pdf, sections 4.10 and C.10.
    \102\ Id. See Table 2-1, Summary of Public Awareness 
Communications for Hazardous Liquids and Natural Gas Transmission 
Pipeline Operators.
---------------------------------------------------------------------------

    69. We accept that the PHMSA requirements will be sufficient to 
alert landowners to many maintenance activities. We will therefore 
modify the prior notice requirement for section 380.15 maintenance 
activities proposed in the NOPR in this proceeding by limiting notice 
to maintenance activities that will cause ground disturbance.\103\ 
Given the potential disruption and impact level of maintenance 
activities that will cause ground disturbance, we find such activities 
merit separate written notice to affected landowners.
---------------------------------------------------------------------------

    \103\ However, if in the future, we receive objections 
indicating that landowners are not adequately informed of particular 
maintenance activities, we may consider applying a separate prior 
notice requirement specific to such activities.
---------------------------------------------------------------------------

    70. While some of these activities will be included in the PHMSA-
mandated biennial report distributed to landowners, we have no 
assurance that all such activities will be. Further, while the PHMSA 
report of planned major maintenance can provide a broad overview of a 
company's future operations, because the company only issues this 
report every other year, it does not give landowners a sufficiently 
precise description of when a particular activity will commence and 
conclude. We believe that if landowners have notice five days before a 
ground disturbing project begins, this will enable companies and 
landowners time to confer, coordinate, and avoid simultaneously 
undertaking incompatible actions. Finally, we note that PHMSA is 
focused on the safe operation of existing facilities, whereas the 
Commission purview of the public interest covers a broader set of 
concerns. Thus, while PHMSA may find no cause to take into account a 
company's activity that inconveniences a landowner but does not 
compromise the safe operation of gas facilities, the Commission may 
find such an activity to be within the scope of its authority to ensure 
the activity is consistent with the public convenience and necessity.
    71. MidAmerican Energy and Golden Triangle request that the 
Commission provide a definition of maintenance under section 380.15 of 
the regulations.\104\ Golden Triangle states that any time its 
personnel enter the right-of-way for periodic routine activities (e.g., 
pipe-to-soil readings, leak patrols, surveillance patrols, meter 
station inspections, and walking the pipeline right-of-way), a 
landowner will construe that entrance as a maintenance activity.\105\
---------------------------------------------------------------------------

    \104\ MidAmerican Energy's Comments at p. 5 and Golden 
Triangle's Comments at p. 9.
    \105\ Golden Triangle's Comments at pp. 9-10.
---------------------------------------------------------------------------

    72. We see no need to craft a definition describing all maintenance 
activities, although we can say that we do not share Golden Triangle's 
apparent view that an intrusion by company personnel onto a landowner's 
property for monitoring purposes is not ``maintenance'' so long as the 
monitoring does not lead to any additional activity during the same 
intrusion. We consider all of the activities identified by Golden 
Triangle to be maintenance. However, as stated above, we are scaling 
back the NOPR's proposal so that prior notice to landowners will only 
be required for ground disturbing maintenance activities. Thus, while 
we believe Golden Triangle's examples are maintenance activities, as 
long as these minor activities do not cause ground disturbance, they 
will not trigger any Commission requirement for advance notice to 
landowners.
6. Burden Resulting From Notification Requirement
    73. Commentors argue that the NOPR did not fully analyze the 
expense and burden associated with requiring landowner notification for 
auxiliary, replacement, and maintenance activities.\106\ INGAA stresses 
that maintenance alone entails hundreds of thousands of property visits 
per year, and that to track these activities company personnel would 
have to write descriptions of each activity, visit the site to 
determine if new residences were installed since the last patrol, hire 
a land agent to identify all affected and abutting landowners, and 
craft and mail formal letters.\107\
---------------------------------------------------------------------------

    \106\ INGAA's March 2013 Comments at pp. 21-25, Southern Star's 
Comments at pp. 5-6, and National Fuel's Comments at p. 2.
    \107\ INGAA's March 2013 Comments at p. 10.
---------------------------------------------------------------------------

    74. Golden Triangle asserts that the expense of complying with the 
proposed landowner notification requirements will have a significant 
impact on small entities.\108\ Golden Triangle states that compliance 
with the landowner notification requirements will include increased 
costs to hire either a contractor or full-time employee, to create a 
database or purchase specialty software, and to mail out letters to all 
of its right-of-way easement holders.\109\
---------------------------------------------------------------------------

    \108\ Golden Triangle claims it is a small entity, which the 
Small Business Administration (SBA) Office of Size Standards defines 
a natural gas company transporting natural gas as small if its 
annual receipts are less than $25.5 million. See 13 CFR Sec.  
121.201 (2013), Subsector 486 and SBA's Table of Small Business Size 
Standards, effective March 26, 2012, available at: http://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf.
    \109\ Golden Triangle's Comments at pp. 7-8.
---------------------------------------------------------------------------

    75. WBI Energy and National Fuel argue that the Commission 
underestimated the amount of time it will take companies to prepare the 
notices.\110\ WBI Energy and INGAA state that the NOPR's estimate that 
there will be three times as many maintenance projects as section 2.55 
projects is a gross underestimation.\111\ National Fuel insists that 
the NOPR's estimate that the entire industry will spend 39,000 hours to 
satisfy the notification requirement is low. National Fuel predicts 
that it will be required to spend approximately six hours to prepare 
and deliver notices to all affected landowners for each maintenance 
activity.\112\ Golden Triangle asserts it will spend at least 16 hours 
on 250 letters for mowing or noxious weed control, in addition to the 
eight hours it estimates will be required to research, update, and 
prepare separate letters for abutting landowners.\113\ In addition, 
MidAmerican Energy states that the landowner notification requirement 
will impose varying burdens on individual pipelines based on the 
activity undertaken. For example, it estimates that farm tap 
installation and maintenance will require 5,400 letters per year; 
check, operate, and lubricate maintenance will require 30,000 letters

[[Page 72809]]

per year; and leak detection surveys will require 7,700 letters per 
year.\114\
---------------------------------------------------------------------------

    \110\ WBI Energy's Comments at p. 11 and National Fuel's 
Comments at p. 4.
    \111\ WBI Energy's Comments at p. 11.
    \112\ National Fuel's Comments at pp. 4-5.
    \113\ Golden Triangle's Comments at p. 9.
    \114\ For maintenance activities on their systems, WBI Energy 
estimated it would have to send 19,500 letters, Northern Natural 
estimated 45,000 letters, and National Fuel estimated 220,000 
letters.
---------------------------------------------------------------------------

    76. We acknowledge that given the wide range of maintenance 
activities described by commentors, we may have underestimated the 
burden of providing prior notice to landowners that would have resulted 
from the NOPR's proposal to require that companies notify landowners, 
including abutting landowners, prior to commencing any activities under 
section 2.55 or section 380.15. However, as discussed above, we are 
limiting the requirement for prior notice to activities that will 
involve ground disturbance. In addition, we are eliminating the 
proposed requirement that companies give prior notice to abutting 
landowners and to landowners with a residence within 50 feet of a 
proposed work area.
    77. We believe these modifications to the NOPR's proposed notice 
requirements will alleviate the concerns for the majority of the 
activities cited by commentors. As a result, we will use a multiplier 
of two times the number of all regulated companies' estimated annual 
auxiliary installations under section 2.55(a) \115\ as a reasonable 
estimate of the total annual number of auxiliary installations, 
replacement projects, and maintenance activities that will require 
prior notice to landowners because the activities will result in ground 
disturbance. We acknowledge that basing the estimated total number of 
activities requiring prior notice on regulated companies' estimates of 
the number of section 2.55(a) auxiliary installations undertaken 
annually is not going to yield the same number as basing our estimate 
on on-site surveys or other verifiable data; nevertheless, we believe 
our estimate is reasonable and is as accurate an estimate as can be 
readily established for purposes of calculating the anticipated burden.
---------------------------------------------------------------------------

    \115\ Based on a survey of nine jurisdictional companies, we 
estimate that approximately 7,605 auxiliary installation projects 
occur each year.
---------------------------------------------------------------------------

    78. As discussed herein, we are also responding to companies' 
concerns that it is often impractical to notify landowners at least 10 
days prior to the start of any section 2.55 or section 380.15 activity, 
as the NOPR's proposal would have required. By requiring that notice be 
received five days and not 10 days prior to undertaking any activity, 
and limiting notice to only ground disturbing rather than all section 
2.55 and section 380.15 activities, we believe companies will be 
subject to the minimal inconvenience necessary to ensure that 
landowners receive adequate advance notice of activities on their 
property that could adversely affect them.
    79. Further, while Golden Triangle indicates that compliance with 
the landowner notification requirements may require companies to create 
a database or purchase specialty software, we do not believe it is 
unreasonable or burdensome if the new notice requirements necessitate 
that some companies update their databases. All gas companies 
(regardless of size) need to know, both to enhance, replace, and 
maintain their facilities and to be able to respond to emergencies, 
precisely where their rights-of-way lie, how to get to their 
facilities, and how to contact the owners of the properties their 
facilities sit upon.\116\ The new notice requirements require companies 
to do little more than access this existing information and update it 
as needed.\117\ Preparation of a notice using information a company 
already needs to have on hand should not be burdensome or delay the 
commencement or progress of activities under section 2.55 or section 
380.15.


---------------------------------------------------------------------------

    \116\ Companies should already have such information on file, 
given that gas facilities generally were constructed under case-
specific certificates obtained in proceedings in which the companies 
were required to give affected landowners notice in accordance with 
section 157.6(d), or were constructed under the blanket certificate 
regulations which require in section 157.203(d) that companies give 
landowners notice of all projects subject to those regulations' 
prior notice provisions. In addition, companies need to periodically 
update such information to be able to comply with the PHMSA biennial 
reporting requirement. Further, since some of the major maintenance 
projects included in the PHMSA report will also qualify for prior 
notice under our new regulations, companies should be able to use 
the same project description to satisfy both PHMSA and Commission 
requirements.
    \117\ Golden Triangle argues that it does not have a database of 
its easement holders. Golden Triangle's Comments at pp. 7-8. We 
expect gas companies to have documented the metes and bounds, terms 
of, and parties to all existing easements. While we recognize that 
this is not a static data set, we expect companies to conduct 
systematic reviews to keep this information current. We note Golden 
Triangle acknowledges, as discussed above, that its personnel need 
to enter its rights-of-way for periodic routine activities including 
pipe-to-soil readings, leak patrols, surveillance patrols, meter 
station inspections, and walking the pipeline right-of-way. Golden 
Triangle's Comments at pp. 9-10. If Golden Triangle does not have a 
database that identifies the precise location of and owners of the 
properties on which it has its rights-of-way, it should.
---------------------------------------------------------------------------

III. Information Collection Statement

    80. The Paperwork Reduction Act (PRA) \118\ requires each federal 
agency to seek and obtain Office of Management and Budget (OMB) 
approval before undertaking a collection of information directed to ten 
or more persons or contained in a rule of general applicability.\119\ 
The OMB's regulations implementing the PRA require approval of certain 
information collection requirements imposed by agency rules.\120\ Upon 
approval of a collection of information, OMB will assign an OMB control 
number and an expiration date. Respondents subject to the filing 
requirements of an agency rule will not be penalized for failing to 
respond to the collection of information unless the collection of 
information displays a valid OMB control number.
---------------------------------------------------------------------------

    \118\ 44 U.S.C. 3501-3520 (2012).
    \119\ OMB's regulations at 5 CFR 1320.3(c)(4)(i) (2013) require 
that ``[a]ny recordkeeping, reporting, or disclosure requirement 
contained in a rule of general applicability is deemed to involve 
ten or more persons.''
    \120\ 5 CFR 1320 (2013).
---------------------------------------------------------------------------

    81. The Commission is submitting the revised reporting requirements 
to OMB for its review and approval. The only entities affected by this 
rule would be natural gas companies under the Commission's 
jurisdiction. The information collection requirements in this Final 
Rule are identified as follows.
    82. FERC-577, ``Gas Pipeline Certificates: Environmental Impact 
Statements,'' identifies the Commission's information collections 
relating to the requirements set forth in NEPA and Parts 2, 157, 284, 
and 380 of the Commission's regulations. Applicants have to conduct 
appropriate studies which are necessary to determine the impact of the 
construction and operation of proposed jurisdictional facilities on 
human and natural resources, and the measures which may be necessary to 
protect the values of the affected area. These information collection 
requirements are mandatory.
    83. Because this Final Rule adds a landowner notification 
requirement for certain activities undertaken pursuant to sections 
2.55, 157, and 380.15 of our regulations, the overall burden on the 
industry will increase. However, because natural gas companies subject 
to our jurisdiction must already notify landowners in conjunction with 
NGA sections 3 projects and 7 case-specific applications and when 
conducting activities under Part 157 of our regulations, no new 
technology will be needed and no start-up costs will be incurred. 
Further, even without the new notification requirement, it is standard 
practice for some companies to inform landowners prior to coming onto 
their property, both as a courtesy and to avoid potential conflicts in 
landowner and company activities. Thus, the notification is expected to 
be consistent

[[Page 72810]]

with current industry practices for some companies, and consequently to 
impose little additional burden on those companies.
    84. We are making some minor modifications to the numbers used to 
derive our estimate. Because, as revised by this Final Rule, the prior 
notice requirement will only apply to those activities that require 
ground disturbance (and not to all section 2.55 and section 380.15 
activities, as was proposed in the NOPR) and will only require notice 
to landowners whose property will be crossed or used (and not to 
abutting landowners and landowners with a residence within 50 feet of 
the proposed work area, as the NOPR would have required), we believe 
the revised estimated burden can no longer be characterized as 
underestimated. The vast majority of activities that commentors 
identified (principally maintenance, such as mowing, noxious weed 
control, and equipment inspection and lubrication) will not be subject 
to our revised notification requirements. As a result, we are 
decreasing our estimate of the burden to notify landowners for 
maintenance activities, as described above in section 6: Burden 
Resulting from Notification Requirement.\121\ In the NOPR, Commission 
staff requested a small representative sample of nine regulated natural 
gas companies to estimate the number of section 2.55(a) activities 
conducted each year. One company provided a response too late to be 
included in the NOPR estimate. Factoring in this company's data results 
in only a trivial change to the burden estimate in this Final Rule.
---------------------------------------------------------------------------

    \121\ Supra PP 73-79.
---------------------------------------------------------------------------

    85. We are also including the burden associated with the change to 
section 157.203(d)(3) which was not included in the NOPR estimates. As 
discussed above, to ensure that the landowner notification requirements 
in sections 2.55(b) and 157.203(d)(3)(i) are equivalent, we are 
revising section 157.203(d)(3)(i) to require notice for ground 
disturbing replacement projects that would have qualified under section 
2.55 but for the fact that replacement facilities are not of the same 
capacity and because of that fact are installed under the blanket 
certificate provisions. As a conservative estimate of the number of 
such capacity altering replacement projects, we assume that the same 
number of replacements take place under the Part 157, Subpart F, 
blanket regulations as under section 2.55(b). This is reflected in the 
table below. We estimate the additional paperwork burden that this 
Final Rule would impose in the table below.

----------------------------------------------------------------------------------------------------------------
                                                         Annual  number of
Regulation section for new landowner  Annual  number of      filings per     Number of  hours     Total annual
      notification requirements        respondents  (A)   respondent \122\    per filing (C)   hours (A) x (B) x
                                                                (B)                                   (C)
----------------------------------------------------------------------------------------------------------------
18 CFR 2.55(a)......................                165                 46                  2             15,180
18 CFR 2.55(b)......................                165                  3                  2                990
18 CFR 157.203(d)(3)................                165                  3                  2                990
18 CFR 380.15.......................                165                 92                  2             30,360
                                     ---------------------------------------------------------------------------
    Total Annual Burden Hours.......  .................  .................  .................             47,520
----------------------------------------------------------------------------------------------------------------

     
---------------------------------------------------------------------------

    \122\ This column reflects a rounded estimate for each 
jurisdictional natural gas company, averaged over all of the 
existing 165 such companies.
---------------------------------------------------------------------------

    86. Given that some companies currently voluntarily comply with the 
new notification requirements, we believe that the actual industry-wide 
increase in burden is likely to be less than what we have estimated 
here.
    Information Collection Costs: The Commission projects the average 
cost for all respondents to be as follows: \123\
---------------------------------------------------------------------------

    \123\ The cost figures are derived by multiplying the total 
hours to prepare a response by an hourly wage estimate of $61 (based 
on average civil engineer wages and benefit information obtained 
from the Bureau of Labor Statistics' data at http://bls.gov/oes/current/naics4_221200.htm#17-0000 and http://www.bls.gov/news.release/ecec.nr0.htm).
---------------------------------------------------------------------------

     $2,898,720 per year for all regulated entities;
     $17,568 per year for each regulated entity.
    Title: FERC-577.
    Action: Revision.
    OMB Control Nos.: 1902-0128.
    Respondents: Natural gas pipeline companies.
    Frequency of Responses: On occasion.
    Necessity of Information: The requirement to notify landowners is 
necessary for the Commission to carry out its NGA responsibilities and 
meet the Commission's objectives of addressing landowner concerns 
fairly. The information provided to landowners is intended to 
accommodate, to the extent possible, any concerns they may have 
regarding a natural gas company's planning, locating, clearing, right-
of-way maintenance, and facility construction or replacement activities 
on their property.
    Internal Review: The Commission has reviewed the revisions and has 
determined that they are necessary. These requirements conform to the 
Commission's need for efficient information collection, communication, 
and management within the energy industry. The Commission has assured 
itself, by means of internal review, that there is specific, objective 
support for the burden estimates associated with the information 
collection requirements.
    87. Interested persons may obtain information on the reporting 
requirements by contacting the Federal Energy Regulatory Commission, 
888 First Street NE., Washington, DC 20426 (Attention: Information 
Clearance Officer, Office of the Executive Director), by phone 202-502-
8663, or by email to DataClearance@ferc.gov. Comments on the 
requirements may also be sent to the Office of Information and 
Regulatory Affairs, Office of Management and Budget, Washington, DC 
20503 [Attention: Desk Officer for the Federal Energy Regulatory 
Commission]. For security reasons, comments should be sent by email to 
OMB at oira_submission@omb.eop.gov. Please reference OMB Control No. 
1902-0128, FERC-577, and Docket No. RM12-11 in your submission.

IV. Environmental Analysis

    88. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant adverse effect on the human environment.\124\ The 
Commission has categorically excluded certain actions from these 
requirements as not having a

[[Page 72811]]

significant effect on the human environment.\125\ Generally, the 
actions proposed to be taken here fall within the categorical 
exclusions in the Commission's regulations that are clarifying, 
corrective, or procedural and for information gathering, analysis, and 
dissemination.\126\ Accordingly, an environmental review is not 
necessary and has not been prepared in connection with this rulemaking 
.


---------------------------------------------------------------------------

    \124\ Regulations Implementing the National Environmental Policy 
Act of 1969, Order No. 486, 52 FR 47897 (December 17, 1987), FERC 
Stats. & Regs., Regulations Preambles 1986-1990 ] 30,783 (1987).
    \125\ 18 CFR 380.4 (2013).
    \126\ 18 CFR 380.4(a)(1) and (5) (2013).
---------------------------------------------------------------------------

V. Regulatory Flexibility Act

    89. The Regulatory Flexibility Act of 1980 (RFA) \127\ generally 
requires a description and analysis of agency rules that will have a 
significant economic impact on a substantial number of small entities. 
The RFA mandates consideration of regulatory alternatives that 
accomplish the stated objectives of a proposed rule and that minimize 
any significant economic impact on a substantial number of small 
entities. The SBA Office of Size Standards develops the numerical 
definition of a small business.\128\ The SBA has established a size 
standard for natural gas pipeline companies transporting natural gas, 
stating that a firm is small if its annual receipts are less than $25.5 
million.\129\
---------------------------------------------------------------------------

    \127\ 5 U.S.C. 601-612 (2012).
    \128\ 13 CFR 121.101 (2013).
    \129\ 13 CFR 121.201, Subsector 486 (2013); see SBA's Table of 
Small Business Size Standards, effective March 26, 2012, available 
at: http://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf.
---------------------------------------------------------------------------

    90. Golden Triangle disagrees with the Commission's statement that 
the proposed rule would not have a significant economic impact on a 
substantial number of small entities. We respond to Golden Triangle in 
Section B.5 above. We modify the small business impact below based on 
the revised estimates used in the information collection section above.
    91. The new regulations impose requirements only on natural gas 
companies subject to the Commission's jurisdiction, the majority of 
which are not small businesses. Most companies regulated by the 
Commission do not fall within the RFA's definition of a small entity. 
Approximately 165 companies--nearly all of them large entities--would 
be potential respondents subject to data collection FERC-577 reporting 
requirements. For the year 2011 (the most recent year for which 
information is available), only 15 companies not affiliated with larger 
companies had annual revenues of less than $25.5 million. Moreover, the 
reporting requirements should have no meaningful economic impact on 
companies--be they large or small--subject to the Commission's 
regulatory jurisdiction. The Commission estimates that the revised cost 
per small entity is $17,568 per year. The Commission does not consider 
the estimated impact per entity to be significant. Accordingly, 
pursuant to section 605(b) of the RFA, the Commission certifies that 
this Final Rule should not have a significant economic impact on a 
substantial number of small entities.

VI. Document Availability

    92. In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
Internet through FERC's Home Page (http://www.ferc.gov) and in FERC's 
Public Reference Room during normal business hours (8:30 a.m. to 5:00 
p.m. Eastern time) at 888 First Street NE., Room 2A, Washington DC 
20426.
    93. From FERC's Home Page on the Internet, this information is 
available on eLibrary. The full text of this document is available on 
eLibrary in PDF and Microsoft Word format for viewing, printing, and/or 
downloading. To access this document in eLibrary, type the docket 
number excluding the last three digits of this document in the docket 
number field.
    94. User assistance is available for eLibrary and the FERC's Web 
site during normal business hours from FERC Online Support at 202-502-
6652 (toll free at 1-866-208-3676) or email at 
ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at 
public.referenceroom@ferc.gov.

VII. Effective Date and Congressional Notification

    95. These regulations are effective February 3, 2014. The 
Commission has determined, with the concurrence of the Administrator of 
the Office of Information and Regulatory Affairs of OMB, that this rule 
is not a ``major rule'' as defined in section 351 of the Small Business 
Regulatory Enforcement Fairness Act of 1996. This rule is being 
submitted to the Senate, House, Government Accountability Office, and 
the Small Business Administration.

List of Subjects

18 CFR Part 2

    Administrative practice and procedure, and Reporting and 
recordkeeping requirements.

187 CFR Part 157

    Administrative practice and procedure, Natural gas, and Reporting 
and recordkeeping requirements.

18 CFR Part 380

    Environmental impact statements, and Reporting and recordkeeping 
requirements.

    By the Commission.
Kimberly D. Bose,
Secretary.
    In consideration of the foregoing, the Commission amends Parts 2, 
157, and 380, Chapter I, Title 18, Code of Federal Regulations, as 
follows:

PART 2--GENERAL POLICY AND INTERPRETATIONS

0
1. The authority citation for Part 2 continues to read as follows:

    Authority:  5 U.S.C. 601; 15 U.S.C. 717-717z, 3301-3432; 16 
U.S.C. 792-828c, 2601-2645, 42 U.S.C. 4321-4370h, 7101-7352.


0
2. Amend Sec.  2.55 by:
0
a. Adding a sentence to the end of paragraph (a)(1);
0
b. Revising paragraph (b)(1)(ii); and
0
c. Adding paragraph (c).
    The revision and additions read as follows:


Sec.  2.55  Definition of terms used in section 7(c).

* * * * *
    (a) * * *
    (1) * * * The auxiliary installations must be located within the 
existing or proposed certificated permanent right-of-way or authorized 
facility site and must be constructed using the temporary work space 
used to construct the existing or proposed facility (see Appendix A to 
this Part 2 for guidelines on what is considered to be the appropriate 
work area in this context).
* * * * *
    (b) * * *
    (1) * * *
    (ii) The replacement facilities will have a substantially 
equivalent designed delivery capacity, will be located in the same 
right-of-way or on the same site as the facilities being replaced, and 
will be constructed using the temporary work space used to construct 
the existing facility (see Appendix A to Part 2 for guidelines on what 
is considered to be the appropriate work area in this context);
* * * * *
    (c) Landowner notification. (1) No activity described in paragraphs 
(a) and (b) of this section that involves ground disturbance is 
authorized unless a company makes a good faith effort to notify in 
writing each affected

[[Page 72812]]

landowner, as noted in the most recent county/city tax records as 
receiving the tax notice, whose property will be crossed or used as a 
result of the proposed activity, at least five days prior to commencing 
any activity under this section. For an activity required to respond to 
an emergency, the five-day prior notice period does not apply. The 
notification shall include at least:
    (i) A brief description of the facilities to be constructed or 
replaced and the effect the activity may have on the landowner's 
property;
    (ii) The name and phone number of a company representative who is 
knowledgeable about the project; and
    (iii) A description of the Commission's Dispute Resolution Division 
Helpline, which an affected person may contact to seek an informal 
resolution of a dispute as explained in section 1b.21(g) of the 
Commission's regulations (18 CFR 1b.21(g)) and the Dispute Resolution 
Division Helpline number.
    (2) ``Affected landowners'' include owners of property interests, 
as noted in the most recent county/city tax records as receiving tax 
notice, whose property is directly affected (i.e. crossed or used) by 
the proposed activity, including all rights-of-way, facility sites 
(including compressor stations, well sites, and all above-ground 
facilities), access roads, pipe and contractor yards, and temporary 
work space.

0
3. Revise Appendix A to Part 2 to read as follows:

Appendix A to Part 2--Guidance for Determining the Acceptable 
Construction Area for Auxiliary and Replacement Facilities

    These guidelines shall be followed to determine what area may be 
used to construct the auxiliary or replacement facility. 
Specifically, they address what areas, in addition to the permanent 
right-of-way, may be used.
    An auxiliary or replacement facility must be within the existing 
right-of-way or facility site as specified by Sec.  2.55(a)(1) or 
(b)(1)(ii). Construction activities for the auxiliary or replacement 
facility can extend outside the current permanent right-of-way if 
they are within the temporary and permanent right-of-way and 
associated work spaces used in the original installation.
    If documentation is not available on the location and width of 
the temporary and permanent rights-of-way and associated work spaces 
that were used to construct the original facility, the company may 
use the following guidance for the auxiliary installation or 
replacement, provided the appropriate easements have been obtained:
    a. Construction should be limited to no more than a 75-foot-wide 
right-of-way including the existing permanent right-of-way for large 
diameter pipeline (pipe greater than 12 inches in diameter) to carry 
out routine construction. Pipeline 12 inches in diameter and smaller 
should use no more than a 50-foot-wide right-of-way.
    b. The temporary right-of-way (working side) should be on the 
same side that was used in constructing the original pipeline.
    c. A reasonable amount of additional temporary work space on 
both sides of roads and interstate highways, railroads, and 
significant stream crossings and in side-slope areas is allowed. The 
size should be dependent upon site-specific conditions. Typical work 
spaces are:

------------------------------------------------------------------------
                                             Typical extra area (width/
                   Item                                length)
------------------------------------------------------------------------
Two lane road (bored).....................  25-50 by 100 feet.
Four lane road (bored)....................  50 by 100 feet.
Major river (wet cut).....................  100 by 200 feet.
Intermediate stream (wet cut).............  50 by 100 feet.
Single railroad track.....................  25-50 by 100 feet.
------------------------------------------------------------------------

    d. The auxiliary or replacement facility must be located within 
the permanent right-of-way or, in the case of nonlinear facilities, 
the cleared building site. In the case of pipelines this is assumed 
to be 50 feet wide and centered over the pipeline unless otherwise 
legally specified.
    However, use of the above guidelines for work space size is 
constrained by the physical evidence in the area. Areas obviously 
not cleared during the original construction, as evidenced by stands 
of mature trees, structures, or other features that exceed the age 
of the facility being replaced, should not be used for construction 
of the auxiliary or replacement facility.
    If these guidelines cannot be met, the company should consult 
with the Commission's staff to determine if the exemption afforded 
by Sec.  2.55 may be used. If the exemption may not be used, 
construction authorization must be obtained pursuant to another 
regulation under the Natural Gas Act.

PART 157--APPLICATIONS FOR CERTIFICATES OF PUBLIC CONVENIENCE AND 
NECESSITY AND FOR ORDERS PREMITTING AND APPROVING ABANDONMENT UNDER 
SECTION 7 OF THE NATURAL GAS ACT

0
4. The authority citation for Part 157 continues to read as follows:

    Authority:  15 U.S.C. 717-717z.


0
5. Amend Sec.  157.202 by revising paragraph (b)(2)(i) to read as 
follows:


Sec.  157.202  Definitions.

* * * * *
    (b) * * *
    (2)(i) Eligible facility means, except as provided in paragraph 
(b)(2)(ii) of this section, any facility subject to the Natural Gas Act 
jurisdiction of the Commission that is necessary to provide service 
within existing certificated levels. Eligible facility also includes 
any gas supply facility or any facility, including receipt points, 
needed by the certificate holder to receive gas into its system for 
further transport or storage, and interconnecting facilities between 
transporters that transport natural gas under part 284 of this chapter. 
Further, eligible facility includes main line, lateral, and compressor 
replacements that do not qualify under Sec.  2.55(b) of this chapter 
because they will result in an incidental increase in the capacity of 
main line facilities, or because they will not satisfy the location or 
work space requirements of Sec.  2.55(b). Replacements must be done for 
sound engineering purposes. Replacements for the primary purpose of 
creating additional main line capacity are not eligible facilities; 
however, replacements and the modification of facilities to rearrange 
gas flows or increase compression for the primary purpose of restoring 
service in an emergency due to sudden unforeseen damage to main line 
facilities are eligible facilities. Eligible facility also includes 
auxiliary installations and observation wells which do not qualify 
under Sec.  2.55(a) of this chapter because they will not satisfy the 
location or work space requirements of Sec.  2.55(a).
* * * * *

0
6. Amend Sec.  157.203 by revising paragraph (d)(3)(i) to read as 
follows:


Sec.  157.203  Blanket certification.

* * * * *
    (d) * * *
    (3) * * *
    (i) No landowner notice is required for replacements which would 
have been done under Sec.  2.55 of this chapter but for the fact that 
the replacement facilities are not of the same capacity as long as they 
meet the location requirements of Sec.  2.55(b)(1)(ii) of this chapter 
and do not cause any ground disturbance; or any replacement done for 
safety, DOT compliance, environmental, or unplanned maintenance reasons 
that are not foreseen and that require immediate attention by the 
certificate holder.
* * * * *

PART 380--REGULATIONS IMPLEMENTING THE NATIONAL ENVIRONMENTAL 
POLICY ACT

0
7. The authority citation for Part 380 continues to read as follows:

    Authority:  42 U.S.C. 4321-4370h, 7101-7352; E.O. 12009, 3 CFR 
1978 Comp., p. 142.


0
8. In Sec.  380.15, redesignate paragraphs (c), (d), (e), and (f) as 
paragraphs (d), (e),

[[Page 72813]]

(f), and (g) and add new paragraph (c) to read as follows:


Sec.  380.15  Siting and maintenance requirements.

* * * * *
    (c) Landowner notification. (1) No maintenance activity that 
involves ground disturbance is authorized unless a company makes a good 
faith effort to notify in writing each affected landowner, as noted in 
the most recent county/city tax records as receiving the tax notice, 
whose property will be crossed or used as a result of the proposed 
activity, at least five days prior to commencing any activity under 
this section. For an activity required to respond to an emergency, the 
five-day prior notice period does not apply. The notification shall 
include at least:
    (i) A brief description of the activity and the effect the activity 
may have on the landowner's property;
    (ii) The name and phone number of a company representative who is 
knowledgeable about the project; and
    (iii) A description of the Commission's Dispute Resolution Division 
Helpline, which an affected person may contact to seek an informal 
resolution of a dispute as explained in section 1b.21(g) of the 
Commission's regulations (18 CFR 1b.21(g)) and the Dispute Resolution 
Division Helpline number.
    (2) ``Affected landowners'' include owners of property interests, 
as noted in the most recent county/city tax records as receiving tax 
notice, whose property is directly affected (i.e. crossed or used) by 
the proposed activity, including all rights-of-way, facility sites 
(including compressor stations, well sites, and all above-ground 
facilities), access roads, pipe and contractor yards, and temporary 
work space.
* * * * *

[FR Doc. 2013-28548 Filed 12-3-13; 8:45 am]
BILLING CODE 6717-01-P